Refer to the figure below:
Let demand remain constant at D; an increase in wages causes firms to be willing and able to sell 150 fewer units at each price than they were before the wage increase.
A. The new equilibrium price and quantity will be P = $6 and Q = 400.
B. The new equilibrium price and quantity will be P = $8 and Q = 300.
C. The new equilibrium price and quantity will be P = $6 and Q = 150.
D. The new equilibrium price and quantity will be P = $7 and Q = 250.
Answer: D
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Referring to the previous question, as a result of the consumer's adjustment to the change in the price of Y, assuming Y is a normal good and X and Y are complements, it is reasonable to expect that the amount of Y consumed will ________, and the
amount of X consumed will ________: A) increase; decrease B) decrease; decrease C) increase; increase D) cannot be determined; cannot be determined
Other things constant, an increase in resource prices will:
a. increase aggregate demand. b. decrease aggregate demand. c. decrease aggregate supply. d. increase aggregate supply.
If the Fed wishes to increase the money supply, it can:
A. sell a bond to bank, and take the money it receives in exchange out of circulation in the economy. B. buy bonds from a bank, giving the bank cash in return, which it can then lend out. C. sell a bond to a bank, and take the money it receives and lend it out to someone else. D. buy a bond from a bank, requiring the bank to hold the money it receives as excess reserves.