Refer to Exhibit 2-6. Which graph depicts the result of a technological improvement in the production of both goods X and Y?

Other things equal, the monopsonistic employer will pay a:

A. lower wage rate and hire fewer workers than will a purely competitive employer. B. higher wage rate but hire fewer workers than will a purely competitive employer. C. lower wage rate but hire a larger number of workers than will a purely competitive employer. D. higher wage rate and hire a larger number of workers than will a purely competitive employer.

The major cause of the recession in 2001 was a decline in _____________ spending.

Fill in the blank(s) with the appropriate word(s).