Refer to the given diagram and assumptions. If unemployment, rather than full employment, had initially existed in Alphania:
(1) The demand for labor in Alphania and Betania are as shown by D A and D B ,
respectively; (2) Alphania's native labor force is F and that of Betania is g; (3) wage L in Alphania is equal to wage m in Betania; and (4) full employment exists in both countries.
A. then Betania's loss of output would have been greater.
B. then Betania's gain of output would have been less.
C. its loss of output would have been less.
D. its loss of output would have been greater.
C. its loss of output would have been less.
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During the 1980s both the relative price and the purchases of BMWs increased dramatically. In the economic way of thinking,
A) the supply curve of BMWs shifted to the right. B) the demand curve for BMWs shifted to the right. C) the supply curve of BMWs shifted to the left. D) the demand curve for BMWs shifted to the left.
According to the Romer model, tax incentives to support research and development will lead to ________
A) higher tax rates in the future B) an increase in the general level of prices C) a decrease in the general level of prices D) increased per capita income