In countries that have high minimum wages and require a lengthy and costly process to get permission to open a business
a. Reducing either the minimum wage or the time and cost to open a business would have no effect on the long-run aggregate supply curve.
b. Reducing the minimum wage and the time and cost to open a business would both shift the long-run aggregate supply curve to the right.
c. Reducing the minimum wage would shift long-run aggregate supply to the right. Reducing the time and cost to open a business would have no affect on the long-run aggregate supply curve.
d. Reducing the minimum wage would have no affect on the long-run aggregate supply curve. Reducing the time and cost to open a business would shift the long-run aggregate supply curve to the right.
b
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Which of the following represents the chain of causation for expansionary policy?
A. An increase in real GDP increases investment, which increases the money supply, which reduces the interest rate. B. An increase in the money supply reduces the interest rate, which increases investment, which increases real GDP. C. An increase in investment increases the interest rate, which increases the money supply, which increases real GDP. D. An increase in the money supply increases investment, which increases the interest rate, which increases real GDP.
Jim saw a decrease in the quantity demanded for his firm’s product from 8000 to 4000 units a week when he raised the price of the product from $200 to $250. What is Jim’s own price elasticity of demand?
In Figure 5-2, compare demand curve D between points F and G to demand curve D' between points J and K. Which of the following statements is correct?
Figure 5-2
a.
Both demand curves have the same slope, but D' is more elastic in the $2 to $3 range.
b.
Both demand curves have the same slope, but D' is less elastic in the $2 to $3 range.
c.
Both demand curves have the same price elasticity of demand, but D' has a larger slope.
d.
Both demand curves have the same price elasticity of demand, but D' has a smaller slope.
e.
Both demand curves have the same slope and the same value for the price elasticity of demand.
The law of diminishing marginal utility implies that
A. supply curves always slope upward and to the right. B. a consumer will always buy positive amounts of all goods. C. demand curves always slope downward and to the right. D. total utility will always increase by an increasing amount as consumption increases.