Why do sticky wages and prices increase the impact of an economic downturn on unemployment and recession?
What will be an ideal response?
Because of the concept of sticky wages and prices, price level of goods and wages stay the same in the event of a recession. Therefore, many of the employers cannot afford to employ people at that level, and many employees are laid off.
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Everything else held constant, if total consumption increases from $600 to $800 because of an increase of disposable income of $400, then the mpc is equal to
A) 0.2. B) 0.4. C) 0.5. D) 0.6.
it permits people to expand production and achieve rates of output that would otherwise be unattainable
What will be an ideal response?
Which of the following is not an example of barriers to entry?
(A) In some counties, laws require retail stores to be closed on Sundays. (B) Cable companies must lay miles of underground cable before they can serve a single customer in a new market. (C) An entrepreneur who wants to own a clothing store must rent a building, hire workers, and buy clothing to sell. (D) A person who wishes to practice medicine is required to attend medical school, do an internship, and pass a state exam.
Refer to the diagram and list of assumptions. If discrimination is ended:
(1) the labor force is comprised of 9 million men and 9 million women workers;
(2) the economy has 3 occupations, X, Y, and Z, each having identical demand curves for labor; (3) men and women workers are homogeneous with respect to their labor-market capabilities; (4) women are discriminated against by being excluded from occupations X and Y and are confined to Z; and (5) aside from discrimination, the economy is competitive, and workers seek to maximize their earnings.
A. men will leave occupations X and Y and enter occupation Z.
B. 4 million women will leave occupation Z, with 2 million entering occupation X and 2 million
entering occupation Y.
C. 3 million women will leave occupation Z, with 1.5 million entering occupation X and 1.5
million entering occupation Y.
D. 3 million women will leave occupation Z, all of whom will enter industry X.