Refer to Figure 14.3. To maximize total wages paid to workers, the labor union will agree to wage rate:

If the actual money multiplier equals the potential money multiplier and if the Fed wishes to reduce the money supply by $1 million when the reserve ratio is 20 percent, then the Fed should

A) sell $200,000 of government securities. B) sell $500,000 of government securities. C) buy $200,000 of government securities. D) buy $500,000 of government securities.

If the price exceeds the average variable cost, by producing the level of output such that marginal revenue equals marginal cost, the firm ensures that it will

A) earn an economic profit. B) not suffer any losses. C) earn the largest profit possible. D) survive in the long run.