In a competitive market for labor, the equilibrium wage always equals the value of the marginal product
a. True
b. False
Indicate whether the statement is true or false
True
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Refer to the table above. What is the marginal product of the sixth worker?
A) 20 pairs of shoes B) 46.7 pairs of shoes C) 60 pairs of shoes D) 280 pairs of shoes
The legal reserve requirement is the
a. actual amount of reserves that banks must hold b. excess amount of reserves that a bank must hold c. minimum amount of reserves the Fed requires a bank to hold d. total amount of reserves that banks hold at all times e. maximum amount of reserves that banks can hold to remain liquid
When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
Based on the model of the money market, when real GDP increases, the equilibrium interest rate should
A) stay the same. B) increase. C) decrease. D) increase to the same extent that the supply of money increases.