If output increases, which of the following would occur?
a. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all increase, and the economy would move downward along the aggregate supply curve.
b. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all decrease, and the economy would move downward along the aggregate supply curve.
c. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all decrease, and the economy would move upward along the aggregate supply curve.
d. Prices of non-labor inputs, input requirements per unit of output, and unit costs would all increase, and the economy would move upward along the aggregate supply curve.
e. Prices of non-labor inputs and input requirements per unit of output would increase, unit costs would decrease, and the economy would move downward along the aggregate supply curve.
D
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The principle that the cost of something is equal to what is sacrificed to get it is known as the
A) reality principle. B) marginal principle. C) principle of opportunity cost. D) principle of diminishing returns.
Consider a small open economy in equilibrium with a current account deficit
(a) Draw a diagram showing this situation. (b) What happens to national saving, investment, and the current account balance in equilibrium if government expenditures rise temporarily? Show this result in your diagram.
Under deferred compensation packages,
A) a moral hazard occurs if a firms fires a good worker before the worker receives her deferred compensation. B) a moral hazard occurs if workers decide not to shirk so as to receive the deferred compensation. C) moral hazards are avoided. D) workers' wages are below their marginal revenue product as they near retirement.
To be officially counted as unemployed, a person must be
A) at least 16 years old. B) at least 18 years old. C) at least 21 years old. D) any age, so long as you are looking for work.