Use the IS-LM-PC model to illustrate how the economy adjusts to an increase in taxes both in the short run and in the medium run

An increase in labor productivity

A) increases the standard of living. B) might be the result of an increase in the quantity of labor. C) generally occurs when physical capital decreases because firms must then hire more workers. D) cannot occur without a corresponding increase in employment. E) decreases the standard of living.

Monopolies are inefficient because, at the profit-maximizing output level,

A) MC = MR. B) MC does not equal MR. C) MB = MC. D) MB does not equal MC. E) P = ATC.