Sometimes increases in the wage rate will cause individuals to work more hours. It is also the case that this same increase could cause people to work fewer hours. What is happening to cause this variance?
What will be an ideal response?
This is generally a case of preferences. At higher wages, it is possible to obtain the same level
of consumption as with a lower wage with fewer hours. Those who prefer to have those hours
as leisure may choose to work less.
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You have noticed that there is a persistent shortage of teachers in an inner-city school district in your state. Based on this observation, you suspect that:
A. the wage for teachers in that district is lower than the equilibrium wage. B. the demand for teachers in the inner-city school district is too low. C. there is an excess supply of teachers in other districts. D. the wage for teachers in that district is higher than the wage in other districts.
If Congress passes legislation reducing Federal Reserve independence, financial market participants are likely to assume that
A) the money supply will decline. B) inflation will increase. C) recession will quickly follow. D) the federal deficit will rise.
College graduates will earn over $1,000,000 more on average than high school dropouts before retiring
Indicate whether the statement is true or false
Other things the same, the real exchange rate between American and Chinese goods would be higher if
a. prices of Chinese goods were higher, or the number of yuan a dollar purchased was higher. b. prices of Chinese goods were higher, or the number of yuan a dollar purchased was lower. c. prices of Chinese goods were lower, or the number of yuan a dollar purchased was higher. d. prices of Chinese goods were lower, or the number of yuan a dollar purchased was lower.