Econ Test 2

Suppose that for a particular firm the only variable input into the production process is labor and that output equals zero when no workers are hired. In addition, suppose that when the firm hires 2 workers, the total cost of production is $100. When the firm hires 3 workers, the total cost of production is $120. In addition, assume that the variable cost per unit of labor is the same regardless of the number of units of labor that are hired. What is the firm's fixed cost? $40 $60 $80 $100

$60

Refer to Table 17-1. If the market for water were perfectly competitive instead of monopolistic, how many gallons of water would be produced and sold? 0 600 900 1,200

1,200

Table 13-7 The Flying Elvis Copter Rides Qty Cost Fxd VC MC AFC AVC ATC 0 $50 $50 $0 -- -- -- -- 1 $150 A B C D E F 2 G H I $120 J K L 3 M N O P Q $120 R Refer to Table 13-7. What is the value of K? $25 $50 $110 $220

$110

Tom's Tent Company has total fixed costs of $300,000 per year. The firm's average variable cost for 10,000 tents is $80. At that level of output, the firm's average total costs equal $80 $90 $100 $110

$110

Refer to Scenario 15-3 (see question above). At Q = 500, the firm's profit is $13,000. $15,000. $17,000. $30,000.

$13,000.

Table 13-7 The Flying Elvis Copter Rides Qty Cost Fxd VC MC AFC AVC ATC 0 $50 $50 $0 -- -- -- -- 1 $150 A B C D E F 2 G H I $120 J K L 3 M N O P Q $120 R Refer to Table 13-7. What is the value of R? $16.67 $50 $136.67 $360

$136.67

Table 13-7 The Flying Elvis Copter Rides Qty Cost Fxd VC MC AFC AVC ATC 0 $50 $50 $0 -- -- -- -- 1 $150 A B C D E F 2 G H I $120 J K L 3 M N O P Q $120 R Refer to Table 13-7. What is the value of Q? $16.67 $50 $136.67 $360

$16.67

John has decided to start his own lawn-mowing business. To purchase the mowers and the trailer to transport the mowers, John withdrew $1,000 from his savings account, which was earning 3% interest, and borrowed an additional $2,000 from the bank at an interest rate of 7%. What is John's annual opportunity cost of the financial capital that has been invested in the business? $30 $140 $170 $300

$170

Table 10-1 The table below contains data for country A for the year 2010. Household purchases of durable goods: $1293 Household purchases of nondurable goods: $1717 Household purchases of services: $301 Household purchases of new housing: $704 Purchases of capital equipment: $310 Inventory changes: $374 Purchases of new structures: $611 Depreciation: $117 Salaries of government workers: $1422 Government expenditures on public works: $553 Transfer payments: $777 Foreign purchases of domestically produced goods: $88 Domestic purchases of foreign goods: $120 Refer to Table 10-1. What was country A's investment in 2010? $1178 $1295 $1882 $1999

$1999

Table 17-10 The table shows the town of Driveaway's demand schedule for gasoline. Assume the town's gasoline seller(s) incurs a cost of $2 for each gallon sold, with no fixed cost. Qty Price Total Revenue 0 $8 $0 50 7 350 100 6 600 150 5 750 200 4 800 250 3 750 300 2 600 350 1 350 400 0 0 Refer to Table 17-10. If the market for gasoline in Driveaway is perfectly competitive, then the equilibrium price of gasoline is $0 and the equilibrium quantity is 400 gallons. $1 and the equilibrium quantity is 350 gallons. $2 and the equilibrium quantity is 300 gallons. $4 and the equilibrium quantity is 200 gallons.

$2 and the equilibrium quantity is 300 gallons.

Refer to Table 17-1. If Rochelle and Alec operate as a profit-maximizing monopoly in the market for water, what price will they charge? $25 $30 $35 $40

$30

Refer to Scenario 15-3 (in earlier question). At Q = 500, the firm's marginal cost is less than $30. $30. $34. greater than $34.

$30.

Table 13-7 The Flying Elvis Copter Rides Qty Cost Fxd VC MC AFC AVC ATC 0 $50 $50 $0 -- -- -- -- 1 $150 A B C D E F 2 G H I $120 J K L 3 M N O P Q $120 R Refer to Table 13-7. What is the value of D? $25 $50 $100 $200

$50

A monopolistically competitive firm is currently producing 10 units of output. At this level of output the firm is charging a price equal to $10, has marginal revenue equal to $6, has marginal cost equal to $6, and has average total cost equal to $12. From this information we can infer that the firm is currently maximizing its profit. the profits of the firm are negative. firms are likely to leave this market in the long run. All of the above are correct.

All of the above are correct.

A movie theater can increase its profits through price discrimination by charging a higher price to adults and a lower price to children if it can prevent children from buying the lower-priced tickets and selling them to adults. has some degree of monopoly pricing power. can easily distinguish between the two groups of customers. All of the above are correct.

All of the above are correct.

A profit-maximizing firm in a monopolistically competitive market is characterized by which of the following? average revenue exceeds marginal revenue marginal revenue equals marginal cost price exceeds marginal cost All of the above are correct.

All of the above are correct.

In game theory, a Nash equilibrium is an outcome in which each player is doing his best given the strategies chosen by the other players. an outcome in which no player wishes to change her chosen strategy given the strategies chosen by the other players. the outcome that occurs when all players have a dominant strategy. All of the above are correct.

All of the above are correct.

Investment from abroad is a way for poor countries to learn the state-of-the-art technologies developed and used in richer countries. is viewed by economists as a way to increase growth. often requires removing restrictions that governments have imposed on foreign ownership of domestic capital. All of the above are correct.

All of the above are correct.

We would expect the interest rate on Bond A to be higher than the interest rate on Bond B if the two bonds have identical characteristics except that Bond A was issued by a financially weak corporation and Bond B was issued by a financially strong corporation. Bond A was issued by the Exxon Mobil Corporation and Bond B was issued by the state of New York. Bond A has a term of 20 years and Bond B has a term of 1 year. All of the above are correct.

All of the above are correct.

Refer to Table 17-10. If there are exactly two sellers of gasoline in Driveaway and if they collude, then which of the following outcomes is most likely? Each seller will sell 50 gallons and charge a price of $7. Each seller will sell 75 gallons and charge a price of $2.50. Each seller will sell 75 gallons and charge a price of $5. Each seller will sell 100 gallons and charge a price of $4.

Each seller will sell 75 gallons and charge a price of $5.

Which of the following is not a characteristic of a competitive market? Buyers and sellers are price takers. Each firm sells a virtually identical product. Entry is limited. Each firm chooses an output level that maximizes profits.

Entry is limited.

Who of the following would necessarily be included in the Bureau of Labor Statistics' "unemployed" category? Lisa, who did not work during the previous 4 weeks Julie, who tried to find new employment during the previous 4 weeks Robert, who was an unpaid worker during the previous 4 weeks None of the above is correct.

NONE OF THE ABOV

For an open economy, the equation Y = C + I + G + NX is an identity. If we define national saving, S, as the total income in the economy that is left after paying for consumption and government purchases, then for an open economy, it is true that S = I S = 0 I = S + NX S = I + NX

S = I + NX

Scenario 15-3 A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $30, its average revenue is $60, and its average total cost is $34. Refer to Scenario 15-3. The firm's profit-maximizing price is $30. between $30 and $34. between $34 and $60. $60.

$60.

Price Quantity $30 0 $25 2.5 $20 5 $15 7.5 $10 10 $5 12.5 $0 15 Refer to Table 15-4. If the monopolist produces 5 units, what is its marginal revenue per unit? $100 $37.5 $15 $2.50

15

Table 15-1 Labor Data for Aridia Year 2010 2011 2012 Adult population 2000 3000 3200 Number of employed 1400 1300 1600 Number of unemployed 200 600 200 Refer to Table 15-1. The labor force of Aridia in 2010 was 1400 1600 1800 2000

1600

A monopoly can set the price it charges for its output and earn unlimited profits. takes the market price as given and earns small but positive profits. can set the price it charges for its output but faces a downward-sloping demand curve so it cannot earn unlimited profits. can set the price it charges for its output but faces a horizontal demand curve so it can earn unlimited profits.

can set the price it charges for its output but faces a downward-sloping demand curve so it cannot earn unlimited profits.

Financial intermediaries are the same as financial markets. individuals who make profits by buying a stock low and selling it high. a more general name for financial assets such as stocks, bonds, and checking accounts. financial institutions through which savers can indirectly provide funds to borrowers.

financial institutions through which savers can indirectly provide funds to borrowers.

Workers searching for jobs that best suit them is most closely associated with cyclical unemployment. frictional unemployment. seasonal unemployment. structural unemployment.

frictional unemployment.

Despite its status as one of the richest countries in the world, Japan has a very low level of productivity. has few natural resources. has very little human capital. engages in a relatively small amount of international trade.

has few natural resources.

In the prisoners' dilemma, the prisoners easily collude in order to achieve the best possible payoff for both. only one player has a dominant strategy. when each player chooses his dominant strategy the players achieve the best joint outcome. when each player chooses his dominant strategy the players reach a Nash equilibrium.

when each player chooses his dominant strategy the players reach a Nash equilibrium.

Refer to Figure 14-1. If the market price rises above $6.30, the firm will earn positive economic profits in the short run. negative economic profits in the short run but remain in business. negative economic profits and shut down. zero economic profits in the short run.

positive economic profits in the short run.

If "too much choice" is a problem for consumers, it would occur in which market structure(s)? perfect competition monopoly monopolistic competition perfect competition and monopolistic competition

monopolistic competition

Which of the following industries is least likely to exhibit the characteristic of free entry? restaurants municipal water and sewer soybean farming selling running apparel

municipal water and sewer

Shannon is a full-time homemaker not currently searching for paid work. Noah is a full-time student who is not looking for a job. Who is included in the labor force by the Bureau of Labor Statistics? only Shannon only Noah both Shannon and Noah neither Shannon nor Noah

neither Shannon nor Noah

Data on the unemployment rate in the U.S. since 1960 show that the unemployment rate is always zero. sometimes zero. rarely zero. never zero.

never zero.

As the number of firms in an oligopoly increases, the price approaches marginal cost, and the quantity approaches the socially efficient level. price and quantity approach the monopoly levels. price effect exceeds the output effect. individual firms' profits increase.

price approaches marginal cost, and the quantity approaches the socially efficient level.

Imperfectly competitive firms are characterized by horizontal demand curves. standardized products. a large number of small firms. price making ability.

price making ability.

Diminishing marginal product suggests that the marginal cost of an extra worker is unchanged. cost of an extra worker is less than the previous worker's marginal cost. product of an extra worker is less than the previous worker's marginal product. product of an extra worker is greater than the previous worker's marginal product.

product of an extra worker is less than the previous worker's marginal product.

The effect of the Black Death in 14th-century Europe was to decrease wages. increase land rents. reduce income inequality between peasants and the landed classes. Both a) and b) are correct.

reduce income inequality between peasants and the landed classes.

If government officials break a natural monopoly up into several smaller firms, then competition will force firms to attain economic profits rather than accounting profits. competition will force firms to produce surplus output, which drives up price. the average costs of production will increase. the average costs of production will decrease.

the average costs of production will increase.

Ralph is a plumber. Which of the following are included in his physical capital? the knowledge he learned on the job, and the tools he uses the knowledge he learned on the job, but not the tools he uses the tools he uses, but not the knowledge he learned on the job neither the knowledge he learned on the job nor the tools he uses

the tools he uses, but not the knowledge he learned on the job

Most entrepreneurs do not have enough money of their own to start their businesses. When they acquire the necessary funds from someone else, their consumption expenditures are being financed by someone else's saving. their consumption expenditures are being financed by someone else's investment. their investments are being financed by someone else's saving. their saving is being financed by someone else's investment.

their investments are being financed by someone else's saving.

Price Quantity $30 0 $25 2.5 $20 5 $15 7.5 $10 10 $5 12.5 $0 15 Refer to Table 15-4. In order to maximize profits, the monopolist should produce 7.5 units. 10 units. where marginal revenue equals marginal cost. Both a) and c) are correct.

where marginal revenue equals marginal cost.

Suppose a firm has a monopoly on the sale of a computer game and faces a downward-sloping demand curve. When selling the 50th game, the firm will always receive less marginal revenue on the 50th game than it received on the 49th game. more average revenue on the 50th game than it received on the 49th game. more total revenue on the 50 game than it received on the first 49 game. Both b) and c) are correct.

less marginal revenue on the 50th game than it received on the 49th game.

Refer to Figure 14-1. The firm will earn a negative economic profit but remain in business in the short run if the market price is above $6.30 but less than $8. above $6.30. less than $6.30 but more than $4.50. less than $4.50.

less than $6.30 but more than $4.50.

If firms are competitive, then labor-market discrimination cannot exist in either the short run or the long run. will be more of a problem than if the market were monopolistic or imperfectly competitive. likely will not be a long-run problem unless customers exhibit discriminatory preferences or government maintains discriminatory policies. likely will be more of a problem in the long run than in the short run due to the zero-profit condition that characterizes long-run equilibrium for competitive firms.

likely will not be a long-run problem unless customers exhibit discriminatory preferences or government maintains discriminatory policies.

Suppose that the adult population is 4 million, the number of unemployed is 0.25 million, and the labor-force participation rate is 75%. What is the unemployment rate? 6.25% 8.3% 9.1% 18.75%

8.3%

Refer to Figure 15-15. If the monopoly firm is not allowed to price discriminate, then consumer surplus amounts to $0. $500. $1,000. $2,000.

$1,000.

Refer to Figure 15-15. If the monopoly firm is not allowed to price discriminate, then the deadweight loss amounts to $50. $100. $500. $1,000.

$1,000.

Babe Ruth's 1931 salary was $80,000. Government statistics show a consumer price index of 15.2 for 1931 and 214.5 for 2009. Ruth's 1931 salary was equivalent to a 2009 salary of about $5,874. $822,566. $1,128,947. $13,560,020.

$1,128,947.

Refer to Figure 16-2. How much consumer surplus will be derived from the purchase of this product at the monopolistically competitive price? $200 $312.50 $400 $800 https://learningsuite.byu.edu/plugins/Upload/fileDownload.php?fileId=wFsOvJWGWt0K&service=scout&appId=student&courseID=jbPYRqRhzm_q

$200

Table 18-8 The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. Labor Output 0 0 1 70 2 130 3 180 4 220 5 250 Refer to Table 18-8. Suppose this firm charges a price of $5 per unit of output and pays workers a wage equal to $160 per day. What is the value of the marginal product of labor for the fourth worker? $200 $1,000 $6,400 $32,000

$200

Tyler and Camille both live in Oklahoma. A new-car dealer in Oklahoma bought a new car from the manufacturer for $18,000 and sold it to Tyler for $22,000. Later that year, Tyler sold the car to Camille for $17,000. By how much did these transactions contribute to U.S. GDP for the year? $18,000 $22,000 $39,000 $57,000

$22,000

In 1949, Sycamore, Illinois built a hospital for about $500,000. In 1987, the county restored the courthouse for about $2.4 million. A price index for nonresidential construction was 14 in 1949, 92 in 1987, and 114.5 in 2000. According to these numbers, the hospital cost about $3.6 million in 2000 dollars, which is less than the cost of the courthouse restoration in 2000 dollars. $3.6 million in 2000 dollars, which is more than the cost of the courthouse restoration in 2000 dollars. $4.1 million in 2000 dollars, which is less than the cost of the courthouse restoration in 2000 dollars. $4.1 million in 2000 dollars, which is more than the cost of the courthouse restoration in 2000 dollars.

$4.1 million in 2000 dollars, which is more than the cost of the courthouse restoration in 2000 dollars.

Refer to Figure 14-1. The firm's short-run supply curve is its marginal cost curve above $1. $3. $4.50. $6.30.

$4.50.

Table 10-1 The table below contains data for country A for the year 2010. Household purchases of durable goods: $1293 Household purchases of nondurable goods: $1717 Household purchases of services: $301 Household purchases of new housing: $704 Purchases of capital equipment: $310 Inventory changes: $374 Purchases of new structures: $611 Depreciation: $117 Salaries of government workers: $1422 Government expenditures on public works: $553 Transfer payments: $777 Foreign purchases of domestically produced goods: $88 Domestic purchases of foreign goods: $120 Refer to Table 10-1. What was country A's GDP in 2010? $6359 $7136 $7253 $8147

$7253 1293 1717 301 704 310 374 611 553 -34 1422

Refer to Figure 16-2. What price will the monopolistically competitive firm charge in this market? $60 $70 $75 $80 https://learningsuite.byu.edu/plugins/Upload/fileDownload.php?fileId=wFsOvJWGWt0K&service=scout&appId=student&courseID=jbPYRqRhzm_q

$80

Table 16-6 Traci's Hairstyling is one salon among many in the market for hairstyling. The following table presents cost and revenue data for haircuts at Traci's Hairstyling. COST Revenue Qty Cost Qty Price 0 $10 -- 0 $50 -- 1 $15 1 $45 2 $21 2 $40 3 $28 3 $35 4 $36 4 $30 5 $45 5 $25 6 $55 6 $20 7 $66 7 $15 8 $78 8 $10 Refer to Table 16-6. At the profit-maximizing quantity, what is Traci's total profit? $30 $59 $77 $84

$84

Johnny is a sophomore in college and has a 1.5 cumulative grade point average (GPA). Johnny's cumulative GPA will fall even further next semester if he performs worse than (i) his cumulative GPA. (ii) he ever performed before. (iii) he did last semester. (i) and (ii) only (i) and (iii) only (ii) and (iii) only (i), (ii), and (iii)

(i) and (ii) only

Crude oil is primarily supplied to the world market by a few Middle Eastern countries. Such a market is an example of a(n) (i) imperfectly competitive market. (ii) monopoly market. (iii) oligopoly market. (i) and (ii) only (ii) and (iii) only (i) and (iii) only (iii) only

(i) and (iii) only

Which of the following statements is true? (i) When a competitive firm sells an additional unit of output, its revenue increases by an amount less than the price. (ii) When a monopoly firm sells an additional unit of output, its revenue increases by an amount less than the price. (iii) Average revenue is the same as price for both competitive and monopoly firms. (ii) only (iii) only (i) and (ii) only (ii) and (iii) only

(ii) and (iii) only

Suppose some country had an adult population of 50 million, a labor-force participation rate of 60 percent, and an unemployment rate of 5 percent. How many people were employed? 1.5 million 28.5 million 30 million 47.5 million

28.5 million

The CPI was 120 in 2008 and 126 in 2009. Phil borrowed money in 2008 and repaid the loan in 2009. If the nominal interest rate on the loan was 8 percent, then the real interest rate was -2 percent. 3 percent. 5 percent. 13 percent.

3 percent.

Table 10-1 The table below contains data for country A for the year 2010. Household purchases of durable goods: $1293 Household purchases of nondurable goods: $1717 Household purchases of services: $301 Household purchases of new housing: $704 Purchases of capital equipment: $310 Inventory changes: $374 Purchases of new structures: $611 Depreciation: $117 Salaries of government workers: $1422 Government expenditures on public works: $553 Transfer payments: $777 Foreign purchases of domestically produced goods: $88 Domestic purchases of foreign goods: $120 Refer to Table 10-1. What was country A's consumption in 2010? $2018 $3010 $3311 $4015

3311

Table 18-8 The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. Labor Output 0 0 1 70 2 130 3 180 4 220 5 250 Refer to Table 18-8. Suppose this firm charges a price of $5 per unit of output and pays workers a wage equal to $160 per day. How many workers should this firm hire to maximize its profit? 2 workers 3 workers 4 workers 5 workers

4 workers labor labor $ output output $ profit 0 0 0 0 0 1 160 70 350 190 2 320 .....

Table 18-8 The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. Labor Output 0 0 1 70 2 130 3 180 4 220 5 250 Refer to Table 18-8. What is the marginal product of the third unit of labor? 40 units 50 units 60 units 180 units

50 units

Table 15-4 A monopolist faces the following demand curve: Price Quantity $30 0 $25 2.5 $20 5 $15 7.5 $10 10 $5 12.5 $0 15 Refer to Table 15-4. In order to maximize total revenues, the monopolist should produce 5 units. 7.5 units. 10 units. 12.5 units.

7.5 units.

Who among the following individuals most likely experiences the largest nonmonetary reward as a supplier of labor? Assume all of the four individuals have the same level of education and work the same number of hours per week. Albert, who prefers to be around other people but who works at home by himself Amy, whose job provides little intellectual and personal satisfaction Antoinette, whose preference is to avoid dangerous work but works as a firefighter Arnold, who works the night shift and prefers to work at night and sleep during the day

Arnold, who works the night shift and prefers to work at night and sleep during the day

Which of the following statements is correct? Assuming that explicit costs are positive, economic profit is greater than accounting profit. Assuming that implicit costs are positive, accounting profit is greater than economic profit. Assuming that explicit costs are positive, accounting profit is equal to economic profit. Assuming that implicit costs are positive, economic profit is positive.

Assuming that implicit costs are positive, accounting profit is greater than economic profit.

Rosie's Flower Shop sells floral arrangements for $20 each. If Rosie hires 10 workers, she can sell 600 arrangements per week. If she hires 11 workers, she can sell 650 arrangements per week. Rosie pays each of her workers $400 per week. Which of the following is correct? For the 11th worker, the marginal profit is $1,000. For the 11th worker, the marginal revenue product is $1,000. The firm is maximizing its profit. If the firm is employing 11 workers, then its profit would increase if it cut back to 10 workers.

For the 11th worker, the marginal revenue product is $1,000.

One bag of flour is sold for $1.00 to a bakery, which uses the flour to bake bread that is sold for $3.00 to consumers. A second bag of flour is sold for $1 to a grocery store who sells it to a consumer for $2.00. Taking these four transactions into account, what is the effect on GDP? GDP increases by $3.00. GDP increases by $5.00. GDP increases by $6.00. GDP increases by $7.00.

GDP increases by $5.00.

Each day Sonja works 8 hours and produces 8 units of goods and services. Emma works 10 hours each day and produces 9 units of goods and services. It follows that Sonja's productivity is higher than Emma's. Emma's productivity is higher than Sonja's. Emma's income per hour will be higher than Sonja's. Sonja's income per day will be higher than Emma's.

Sonja's productivity is higher than Emma's.

Assume an economy experienced a positive rate of inflation between 2003 and 2004 and again between 2004 and 2005. However, the inflation rate was lower between 2004 and 2005 than it was between 2003 and 2004. Which of the following scenarios is consistent with this assumption? The CPI was 100 in 2003, 110 in 2004, and 105 in 2005. The CPI was 100 in 2003, 120 in 2004, and 135 in 2005. The CPI was 100 in 2003, 105 in 2004, and 130 in 2005. The CPI was 100 in 2003, 90 in 2004, and 88 in 2005.

The CPI was 100 in 2003, 120 in 2004, and 135 in 2005.

Last year Panglossia had real GDP of 27.0 billion. This year it had real GDP of 31.5 billion. Which of the following changes in population is consistent with a 5 percent growth rate of real GDP per person over the last year? The population decreased from 88 million to 84 million. The population decreased from 75 million to 73 million. The population increased from 45 million to 50 million. The population increased from 60 million to 62 million.

The population increased from 45 million to 50 million.

In an imaginary economy, consumers buy only razors and cologne. The fixed basket consists of 6 razors and 4 bottles of cologne. A razor cost $20 in 2009 and $25 in 2010. A bottle of cologne cost $30 in 2009 and $40 in 2010. Using 2009 as the base year, which of the following statements is correct? For the typical consumer, the number of dollars spent on razors is equal to the number of dollars spent on cologne in each of the two years. The consumer price index is 310 in 2010. The rate of inflation is 29.17% in 2010. None of the above is correct.

The rate of inflation is 29.17% in 2010.

Which of the following statements is not correct? If the signaling theory of education is correct, additional schooling does not affect worker productivity but rather signals a correlation between natural ability and education. The theory of efficiency wages suggests that firms pay higher wages to workers in order to induce workers to be more productive. Discrimination against workers of a certain race or ethnicity is often in conflict with a firm's desire to maximize profits. The theory of compensating wage differentials reflects the different skills, abilities, and productivity of workers.

The theory of compensating wage differentials reflects the different skills, abilities, and productivity of workers.

President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that one of them must be lying. both of them could be telling the truth if the labor force and employment grew at the exact same rate both of them could be telling the truth if the labor force grew slower than employment. both of them could be telling the truth if the labor force grew faster than employment.

both of them could be telling the truth if the labor force grew faster than employment.

Some persons are counted as out of the labor force because they have made no serious or recent effort to look for work. However, some of these individuals may want to work even though they are too discouraged to make a serious effort to look for work. If these individuals were counted as unemployed instead of out of the labor force, then both the unemployment rate and labor-force participation rate would be higher. the unemployment rate would be higher and the labor-force participation rate would be lower. the unemployment rate would be lower and the labor- force participation rate would be higher. both the unemployment rate and labor-force participation rate would be lower.

both the unemployment rate and labor-force participation rate would be higher.

The Eye of Horus incense company has $10 million in cash which it has accumulated from retained earnings. It was planning to use the money to build a new factory. Recently, the rate of interest has increased. The increase in the rate of interest should not influence the decision to build the factory because The Eye of Horus doesn't have to borrow any money. not influence the decision to build the factory because its stockholders are expecting a new factory. make it more likely that The Eye of Horus will build the factory because a higher interest rate will make the factory more valuable. make it less likely that The Eye of Horus will build the factory because the opportunity cost of the $10 million is now higher.

make it less likely that The Eye of Horus will build the factory because the opportunity cost of the $10 million is now higher.

A difference in wages between a highly-educated worker and a less-educated worker may be due to a difference in the amounts of human capital between the workers. may be a signal that the market is indifferent to a worker's level of human capital. is considered unfair by economists. is considered unfair by everyone.

may be due to a difference in the amounts of human capital between the workers.

Refer to Table 16-6. Given the cost and revenue data, Traci's is not in a long-run equilibrium. More businesses will enter the hair salon market in the long-run. not in a short-run equilibrium. not in a long-run equilibrium. Some businesses currently in the hair salon market will exit the market in the long-run. in a long-run equilibrium.

not in a long-run equilibrium. More businesses will enter the hair salon market in the long-run.

In recent years, the ratio of earnings of the typical U.S. college graduate to the earnings of the typical high school graduate without additional education has risen as the demand for skilled labor has increased relative to the demand for unskilled labor. risen as the demand for skilled labor has decreased relative to the demand for unskilled labor. fallen as the demand for skilled labor has increased relative to the demand for unskilled labor. fallen as the demand for skilled labor has increased relative to the demand for unskilled labor.

risen as the demand for skilled labor has increased relative to the demand for unskilled labor.

Evidence indicates that the typical person who becomes unemployed will soon find a job find a job, but not before a year or more has gone by leave the labor force and never return retire soon after

soon find a job