It is spring, and several graduates of State U are seeking employment. State U graduates have evenly distributed GPAs, from 2.0 to 4.0, with an average GPA of 3.0. The largest employer in town, Acme Dynamite, is interviewing candidates, hoping to hire a few hard workers. While Acme does not require students to submit a transcript with their applications, the hiring officer believes that high GPAs signal a willingness to work hard. Suppose that all State U students have the same academic ability when they enter college and do not learn anything in college that will be useful to them while working at Acme. Students differ only in their willingness to work hard and study for their classes. In this case:
A. Acme will not care about a student's GPAs because all students enter college with the same academic ability.
B. Acme will not care about a student's GPAs because the students at State U don't learn anything useful in their classes.
C. Acme will use a student's GPA as a signal of the student's willingness to work hard.
D. there is no benefit to studying hard in college.
Answer: C
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For many goods, the price elasticity of demand increases over time after a price hike because
A) consumer incomes tend to increase over time. B) inflation increases all prices and incomes over time. C) the ability to find good substitutes for the product whose price rose increases over time. D) All of the above answers are correct.
If all firms expect greater demand for their products or services, they will hire _____ resources like labor and capital and the economy will experience _____
a. fewer; recession
b. fewer; growth
c. more; deflation
d. more; recession
e. more; growth
Which of the following is true?
a. Employers who discriminate against blacks and other minorities will have lower costs than rival firms that hire employees strictly on the basis of merit (productivity). b. After adjusting for factors such as education, experience, and location, the earnings of black men are almost identical to the earnings of similar white men. c. If employers can hire equally productive minority employees at a lower wage than non-minorities, the profit motive provides a strong incentive to do so. d. The empirical evidence indicates that the earnings gap between whites and blacks is entirely the result of employment discrimination.
If the market interest rate decreases, then there will _____
Fill in the blank(s) with the appropriate word(s).