The primary objective of economics is
A. to study how people make choices with limited resources.
B. to study why some people are never happy with the resources they have.
C. to learn how to create more resources.
D. to learn how to make the most profits with a given amount of resources.
Answer: A
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An economy currently has an inflationary gap. An increase in the money wage rate will ________ the inflationary gap and ________ the price level
A) decrease; decrease B) increase; increase C) increase; decrease D) decrease; increase
Explain the Fed's three tools of monetary policy and how each is used to change the money supply. Does each tool affect the monetary base or the money multiplier?
What will be an ideal response?
If a perfectly competitive industry is monopolized, consumer surplus
a. can be expected to decrease b. will usually remain constant c. can be expected to increase d. drops from a high value to zero e. increases from zero to a high value
A good salesperson can sell $200,000 worth of goods, while a poor one can sell only a smaller amount worth of goods. Job applicants know if they are good or bad, but the firm does not
A firm will offer job applicants a choice between a fixed salary of $20,000 or a 20% commission. Assume risk-neutral salespersons and no opportunistic behavior. Given that the firm wants to distinguish a prospective good salesperson from a poor one, what should be the sales amount of a poor salesperson? A) more than $150,000 B) less than $100,000 C) more than $100,000 D) $100,000