In Figure 45.4, when compared to the perfectly competitive equilibrium, the wage paid to employees as a result of unionization 
Figure 45.4
A. remains at W'.
B. remains at W*.
C. increases from W* to W'.
D. decreases from W' to W*.
Answer: C
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The monetary transmission mechanism that assumes that money supply growth stimulates the economy primarily by encouraging investment is
A) the classical transmission mechanism. B) pre-Keynesian transmission mechanism. C) the interest-rate-based transmission mechanism. D) the post-Keynesian transmission mechanism.
Suppose a U.S.-made machine costs $500 and the exchange rate is 100 yen = $1. Now the exchange rate changes to 90 yen = $1. Then the machine would now cost
A. more dollars. B. the Japanese citizen less yen. C. fewer dollars. D. the Japanese citizen more yen.
When plotted with the aggregate price level on the vertical axis and output on the horizontal axis, which of the following curves slopes downward?
A. SRAS B. AD C. LRAS D. None of the above
Suppose that the price of a jar of peanut butter is $5 and the price of a jar of jelly is $3. What is the relative price of a jar of peanut butter?
A) 2.400 B) 0.417 C) 0.250 D) 1.667