Classical unemployment can be caused by which of the following?
A. Efficiency wages
B. Bargaining by unions
C. Minimum wage laws
D. All these create classical unemployment.
Answer: D
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In the figure above, if a tax is imposed that generates an efficient allocation of resources, then consumers will pay a price of
A) $250 per unit. B) $200 per unit. C) $150 per unit. D) $100 per unit.
Which of the following describes a difference between the marginal product of labor and the marginal revenue product of labor?
A) The marginal product of labor declines as each additional worker is hired because of the law of diminishing returns. The marginal revenue product of labor declines as each additional worker is hired because of diseconomies of scale. B) The marginal product of labor is inelastic. The marginal revenue product of labor is elastic. C) The marginal product of labor declines as each additional worker is hired because of the law of diminishing returns. The marginal revenue product increases as each additional worker is hired because of increases in the productivity of labor. D) The marginal product of labor measures the change in output as additional workers are hired. The marginal revenue product measures the change in revenue as additional workers are hired.
Refer to the table below. If the profit for each unit of paper product is $3.00 and the profit for each unit of lumber is $13.50, what is Big Oaks' marginal cost of producing between points B and C on their production possibilities frontier?
Big Oaks can produce either paper products or lumber with each tree that they harvest. Because Big Oaks can adjust the amount of paper products and lumber they produce from the harvested trees, paper products and lumber are produced in variable proportions. The above table summarizes Big Oaks production possibilities from each harvested tree.
A) $5.75
B) $3.75
C) $1.25
D) $7.50
The long-run supply curve for a competitive industry may be upward sloping if
a. there are barriers to entry. b. firms that enter the industry are able to do so at lower average total costs than the existing firms in the industry. c. some resources are available only in limited quantities. d. accounting profits are positive.