The trade-offs between inflation and unemployment experienced in the 1970s and 1980s indicated to neo-Keynesians that the long-run Phillips curve was

Assume that in a price-fixing game, if Player A breaks the agreement in the first year, she earns $11 while Player B earns $5 . However, if Player A breaks the agreement once, Player B decides to break the agreement for eternity, leaving each to receive $8 per year for the rest of their lives. If they both keep the agreement each receives $9 per year for the rest of their life. If the discount

rate is 120 percent per period: a. Player A will prefer to break the agreement in the first year. b. Player A will prefer to break the agreement in the second year. c. Player A will prefer to keep the agreement throughout her life. d. Player A will prefer to keep the agreement only for the first five years.

What benefit would a worker get by joining a union?

a. There is strength in numbers when it comes to negotiations. b. It is the only way to get paid vacation and health benefits. c. Most large employers have a close relationship with union workers. d. Union membership would open up even more jobs to the worker.