We would expect that a fall in labor supply will have a proportionately smaller effect on the market wage rate when
A) workers can easily be replaced by capital goods.
B) the product produced in the industry has very few substitutes.
C) the product is produced in a perfectly competitive industry.
D) labor represents a relatively small portion of total costs.
Answer: A
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If exports increase, then the aggregate expenditure curve shifts ________ and equilibrium expenditure ________
A) upward; decreases B) upward; increases C) downward; increases D) downward; decreases E) upward; does not change
Which of the following statements is true?
A) Optimization in levels is based on behavioral analysis. B) Optimization in differences is based on marginal analysis. C) Optimization in differences is often faster than optimization in levels, as it considers all aspects of the feasible alternatives. D) Optimization in levels is often slower to implement than optimization in differences, as it considers only the aspects in which alternatives differ.