To compare the purchasing power of nominal wages in two different years, one must:
A. increase both quantities by the same percentage increase in a price index.
B. deflate both quantities by a common price index.
C. compare the nominal values.
D. adjust both quantities by the real interest rate.
Answer: B
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One thousand adults live in Milltown. Every day, they all leave work at 4:30 p.m., arrive home at exactly 5:00 p.m., and go to bed at 9:00 p.m. Three fundraisers, Alpha, Beta, and Charlie, have targeted Milltown's population. To get a donation, they must call Milltown's residents after they get home from work but before they go to bed. Because the charities raising the funds are identical, the first to call a willing donor will get the donation. Calls made by the fundraisers will tend to be:
A. clustered near 5:00 p.m. B. clustered near 7:00 p.m. C. clustered near 6:00 p.m. D. evenly distributed throughout the evening.
The majority of American workers are employed in the service sector of the economy.
Answer the following statement true (T) or false (F)
An external cost in the production of a good creates a difference between the
i. costs borne by the producer and the costs borne by society in general. ii. efficient quantity of output and the equilibrium quantity of output. iii. marginal social cost and the marginal private cost. A) i only B) iii only C) ii and iii D) i, ii, and iii E) i and iii
Why is it necessary for a firm that practices price discrimination be a price maker rather than a price taker?
What will be an ideal response?