In order to spend more time with her children, a young mother decides to work less hours as her pay increases. What does her labor supply curve look like?
What will be an ideal response?
The young mother's labor supply curve is backward bending. In other words, her labor supply curve is positively sloped at lower wage rates, indicating that a higher wage increases the quantity of labor she supplies. But when her wage reaches a certain amount, further increases in the wage decrease the quantity of labor she supplies and her labor supply curve becomes negatively sloped.
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When the Fed buys government securities, ________ and the money supply ________
A) e rises, falls B) e falls, rises C) c rises, falls D) c falls, rises E) H rises, rises
Think of the speculative motive for holding money: As the interest rate decreases from 10 percent to 5 percent, the quantity of money people will hold
a. decreases by some quantity, but not necessarily by 50 percent b. increases by some quantity, but not necessarily doubles c. remains unchanged d. doubles e. falls by 50 percent
A product is considered to be excludable if it is jointly owned by all members of a community
Indicate whether the statement is true or false
Everything else held constant, if aggregate output is to the left of the LM curve, then there is an excess ________ of money which will cause the interest rate to ________
A) supply; fall B) supply; rise C) demand; fall D) demand; rise