If leisure is a normal good, then the income effect of a decrease in wage will
A) decrease the number of hours worked.
B) increase the number of hours worked.
C) decrease the number of leisure hours.
D) increase the sum of leisure plus hours worked.
B
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In the long run in a monopolistically competitive market, a firm will, in theory,
A) earn economic profits. B) suffer losses. C) break even. D) earn zero accounting profits.
Gwen's decision to buy a new television instead of a bicycle for the same price
a. means that opportunity cost is zero since both cost the same amount. b. would not have involved trade-off and opportunity cost if Gwen had decided to put the money in a bank CD instead. c. would not imply a trade-off because of scarcity if Gwen were a multimillionaire. d. means that the opportunity cost to Gwen is the bicycle that she has given up.
Which term describes the phases of expansion and contraction in an economy over time?
A. Recessions B. Prosperity C. Total product oscillations D. Business cycles
The Keynesian approach assumes that
A) the economy is self-regulating. B) there is no unemployment in the economy. C) the price level is fixed. D) the government budget is always in deficit.