A firm's total profit equals its marginal revenue minus its marginal cost

The graph shows the labor market for painters. The lower the wage rate, the ________ is the quantity of painters that firms demand and the ________ is the quantity of painters that households are willing to supply

A) greater; smaller B) greater; greater C) smaller; greater D) smaller; smaller E) None of the above answers is correct because both the demand and supply curves will shift in response to the change in the wage rate.

Refer to Figure 27-1. Suppose the economy is in short-run equilibrium above potential GDP and automatic stabilizers move the economy back to long-run equilibrium

Using the static AD-AS model in the figure above, this would be depicted as a movement from A) D to C. B) C to B. C) A to E. D) B to A. E) E to A.