In case of a backward-bending labor supply curve:
a. the income effect of a higher wage offsets the substitution effect.
b. the substitution effect of a higher wage offsets income effect.
c. the substitution effect of a higher wage equals income effect.
d. there is no income effect at a higher wage rate.
a
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The prisoner's dilemma shows that
A) players are better off if they act independently. B) monopolies are beneficial to society. C) people will always cheat. D) players would be better off if they cooperated.
Recently, you decided to super-size your fries at McDonald's. On the one hand, your decision to super-size considered the additional costs associated with the super-size, including the additional monetary, caloric and cholesterol intake, as well as the extra time you had to wait for those fries because a new batch was being prepared. On the other hand, you determined that the extra benefits from super-sizing included a few more mouthfuls of satisfaction from an increased portion of fries. The benefits clearly outweighed the costs since you chose to super-size. Which of the following does this illustrate?
a. Marginal analysis b. The law of demand c. Delayed gratification d. Diminishing marginal utility e. Random behavior
When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease. B. prices, causing them to definitely rise. C. output, causing it to definitely increase. D. prices, causing them to definitely fall.
Monopolies are characterized by a firm demand curve that is more elastic than the market demand curve.
Answer the following statement true (T) or false (F)