Diane's Auto World installs tires on automobiles, light trucks, and sport utility vehicles. She is a profit-maximizing business owner whose firm operates in a competitive market. The marginal cost of installing a tire is $20 . The marginal productivity of the last worker that Diane hired was 2 tires per hour. What is the maximum hourly wage that Diane was willing to pay the last worker hired?

The school of thought that emphasizes the possibility that an economy can be in equilibrium at less than full employment with inflation and argues that by managing aggregate demand, government can achieve the most acceptable combination of unemployment and inflation is the

a. Keynesian b. neo-Keynesian c. monetarist d. supply-side school e. rational expectations school

Due to automatic stabilizers, when the nation's total income rises, government transfer payments

A. and tax revenues increase. B. decrease and tax revenues increase. C. increase and tax revenues decrease. D. and tax revenues decrease.