The formula (MPL)(MRX), where L is for labor and X is the output, is for
A. the marginal product of labor.
B. the marginal revenue from labor.
C. total revenue of labor.
D. the marginal revenue product of labor.
Answer: D
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The concerns about the 2009 $787 billion stimulus by the Obama Administration were that
a. it was too small. b. it was too large. c. it was not well designed. d. Some economists opposed any stimulus whatsoever. e. All of the above.
Assume that the budget constraint in the figure below is: P E E + P A A = I, where I is total income and P E is the price of education and P A is the price of all other goods. If U(E,A) = A + E, P E = 2, P A = 1, and I = 10. If the price of education drops to 1, how much of the two goods are consumed now?
In the macroeconomy, demand-side shifts change:
A. aggregate demand only, which is why the price level remains unaffected in the long run. B. only the output level in the long run, while prices eventually return to their long-run potential levels. C. only the price level in the long run, while output eventually returns to its long-run potential level. D. aggregate demand only, which eventually shifts back in the long run.
Higher real income ________ the demand for money and a higher price level ________ the demand for money.
A. decreases; increases B. increases; decreases C. increases; increases D. decreases; decreases