Refer to Figure 13-3. Suppose the economy is at point C. If government spending decreases in the economy, where will the eventual long-run equilibrium be?

Critics of the minimum wage argue that as an antipoverty device it is "poorly targeted." By this they mean that:

A. the minimum wage only applies to a small percentage of the labor force. B. many who benefit from the minimum wage are teenagers or not poor. C. the government has been unable to enforce the minimum wage. D. the average level of wages in the economy is considerably higher than the minimum wage.

As output rises, average fixed cost

A. rises. B. falls. C. remains the same.