If the price of output increases, the equilibrium wage of workers who produce that output will ________ and ________ workers will be hired.
A. increase; more
B. increase; fewer
C. decrease; more
D. decrease; fewer
Answer: A
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When the Fed sells bonds on a mass scale
A) bonds go to the Fed, and dollars go into the banking system, so the money supply tends to rise. B) bonds go to the Fed, and dollars exit the banking system, so the money supply tends to fall. C) banks have fewer bonds and more dollars, so the money supply tends to rise. D) banks have more bonds and fewer dollars, so the money supply tends to fall.
How short is the short-run production period?
Between 1980 and the early 1990s, the national debt
a. as a percentage of GDP, decreased b. remained fairly constant c. as a percentage of GDP, remained relatively unchanged d. as a percentage of GDP, increased e. declined
It is true that the distribution process carried out by the price system
a. accomplishes the task more efficiently than central planners would. b. favors the rich. c. is superior to other rationing mechanisms because it is able to pay attention to individual consumer preferences. d. All of the above are true.