Susan is a plant manager in charge of a factory in a relatively poor country. Even though market wages are low, she decides to raise the wages of her workers. Her decision
a. might increase profits if it means that the wage is high enough for her workers to eat a nutritious diet that makes them more productive.
b. will help eliminate the excess supply of labor.
c. may cause her workers to reduce the effort they expend at their jobs.
d. All of the above are correct.
a
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When interest rates are lower, consumers and companies are able to borrow money cheaply in order to make major purchases. As a result, the demand for goods in an economy will generally
A) remain the same. B) increase. C) decrease. D) be minimally affected.
An income tax cut ________ aggregate demand and ________ aggregate supply
A) increases; decreases B) increases; increases C) decreases; decreases D) decreases; increases E) does not change; increases
Which of the following is the smallest portion of the market basket of goods that makes up the CPI?
A) food and beverages B) apparel C) transportation D) housing
The purpose of commodity buffer stocks is
(a) to moderate price fluctuations. (b) to raise commodity prices. (c) to encourage commodity substitution. (d) to guarantee national security.