Why does a change in GDP affect unit costs and the price level?
a. as GDP increases, productivity increases.
b. as GDP increases the price of non-labor inputs increases and the nominal wage tends to increase.
c. as GDP decreases, there are efficient gains
d. as GDP increases, economies of scale allow for lower unit costs.
e. as GDP increases the price of non-labor inputs decreases and the nominal wage tends to increase.
B
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This Application examines the concept of
A) sticky prices. B) consumer spending habits. C) stagflation. D) the wealth effect.
Suppose there is an increase in the short-run aggregate supply with no change in the long-run aggregate supply. This situation could be the result of
A) an increase in the price of oil. B) a decrease in the money wage rate. C) a technological advancement. D) an increase in the quantity of capital.
As the quantity of labor employed by a firm decreases, labor's ________ increases
A) marginal cost B) value of marginal product C) marginal revenue D) average cost
Define the term "property rights." Explain why the lack of well-defined and enforceable property rights is detrimental to the smooth functioning of a market system
What will be an ideal response?