Assume that labor is a variable input. The average wage of workers increases in a purely competitive industry. This change will result in a(n)
A. increase in marginal cost for firms in the industry and an increase in the industry supply curve
B. decrease in marginal cost for firms in the industry and a decrease in the industry supply curve
C. decrease in marginal cost for firms in the industry and an increase in the industry supply curve
D. increase in marginal cost for firms in the industry and a decrease in the industry supply curve
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According to the aggregate production function, when inputs increase
A. the economy grows. B. inflation slows. C. GDP declines. D. unemployment rises.
Which of the following is NOT true at the equilibrium quantity of GDP demanded?
What will be an ideal response?
Which of the following is the best example of supply-side policy?
A. Inflation during the 1970s. B. The Reagan tax cuts in 1981. C. The government response to the Great Depression. D. Government policy before 1930.
In response to an unanticipated tightening of monetary policy, output ________ at first, then ________ after about four months.
A. rises; returns most of the way to its original value B. falls; returns most of the way to its original value C. remains roughly unchanged; rises significantly D. remains roughly unchanged; falls significantly