An economy in which output has decreased and prices have increased would suggest that there has been a:

To maximize profits, firms hire labor as long as

A) each additional hour hired produces more additional output than the real wage rate. B) the total hours hired produces more additional output than the real wage rate. C) each additional hour hired produces more additional output than the nominal wage rate. D) the quantity of labor supplied increases as the real wage rate increases. E) workers continue to supply labor to the firm.

An example of a shortage is limited amounts of:

a) water available for irrigating a crop because it is used for other crops b) labor available because the workers have other jobs c) food available because the trucks carrying it are on strike d) food available because few people want to buy it