If both labor demand and labor supply fall, what will happen to the real wage, employment, and output?
a. The real wage will increase, real output will increase, but the effect on employment depends upon the magnitudes of the shifts.
b. The real wage will increase, but the effects of employment and real output depend upon the magnitudes of the shifts.
c. The real wage, employment, and real output will all decrease.
d. Employment and real output will decrease, but the effect on the real wage depends upon the magnitudes of the shifts.
e. The real wage, employment, and real output will all increase.
D
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The rutabaga market is perfectly competitive. Research is published claiming that eating rutabagas leads to gaining weight and so the demand for rutabagas permanently decreases. The permanent decrease in demand results in a
A) lower price, economic losses by rutabaga farmers, and entry into the market. B) lower price, economic losses by rutabaga farmers, and exit from the market. C) higher price, economic profits for rutabaga farmers, and entry into the market. D) higher price, economic losses by rutabaga farmers, and exit from the market. E) lower price, economic profits for rutabaga farmers, and entry into the market.
If actual inflation is less than expected inflation, actual real wages will be ________ expected real wages and unemployment will ________
A) less than; rise B) less than; fall C) greater than; rise D) greater than; fall
Based on most observations, what are the effects on government budgets from the national health care program?
A) Tax revenues will not flow into the new program immediately. B) The federal government ultimately will have to search for ways to reduce its health care expenditures. C) Federal government expenditures on the program are being phased in immediately. D) the federal government ultimately will lower taxes since the program's cost will decline over time.
According to the income effect, lower prices give people more purchasing power with which to increase the quantity demanded of goods
a. True b. False Indicate whether the statement is true or false