Assume the market for candles is competitive. A decrease in the market price of candles
a. decreases the demand for workers who make candles and decreases their equilibrium wage.
b. decreases the demand for workers who make candles and increases their equilibrium wage.
c. increases the demand for workers who make candles and decreases their equilibrium wage.
d. increases the demand for workers who make candles and increases their equilibrium wage..
a
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The figure above shows the production possibilities frontier for a country. If the economy is operating at point B, then the opportunity cost of another million gallons of milk is
A) 4 gallons of ice cream for a gallon of milk. B) 3 gallons of ice cream for a gallon of milk. C) 1 gallon of ice cream for a gallon of milk. D) 1/3 of a gallon of ice cream for a gallon of milk. E) zero because after producing another million gallons of milk then zero gallons of ice cream are produced.
If a brewery wants to raise funds to purchase a new fermenting vat, it does so in the
A) alcoholic beverages market. B) output market. C) factor market. D) product market.
Private solutions often are not possible due to the costs of negotiating and enforcing these solutions. Such costs are called: a. transaction costs
b. external costs. c. deadweight losses. d. social costs.
Currently, total government expenditures in the United States is approximately:
a. 50 percent of GDP. b. 75 percent of GDP. c. 40 percent of GDP. d. 80 of GDP.