When aggregate demand declines unexpectedly and wage contracts are fixed, then the average price level will:
a. increase and business firms will hire new workers.
b. decline and firms will reduce wages.
c. decline and business firms will lay off workers.
d. increase and business firms will lay off workers.
e. increase and business firms will increase wages.
c
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In the above table, what is marginal product of labor for the 2nd worker?
A) 20 B) 8 C) 10 D) 12
In recent years, the price of smartphones has fallen, while the quantity exchanged of smartphones has risen. We can conclude that this is most likely a result of
A) a decrease in supply while demand remained constant. B) an increase in demand while supply remained constant. C) an increase in demand that exceeded an increase in supply. D) an increase in supply that exceeded an increase in demand.
The reserve ratio is 10 percent. Depositors regularly keep 10 percent of their deposits as cash. If the Fed buys $1 million of U.S. government securities, excess reserves
A) increase by $800,000. B) increase by $810,000. C) increase by $900,000. D) increase by $1 million.
Which of the following best explains the R&E Tax Credit?
a. Private firms’ taxes are reduced based on their R&D activities. b. Private firms receive government grants for R&D investments. c. Universities that engage in R&D receive additional tax breaks. d. Citizens receive government grants for developing new technologies.