Use the following graph for a market to answer the question below.
Which of the following could not explain the indicated increase in equilibrium price from P1 to P2?
A. an increase in production costs
B. an increase in consumer incomes
C. an increase in the price of a substitute product
D. a decrease in the price of a complementary product
Answer: A
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When interpreting the meaning of an exchange rate, the first step is to always:
a. know exactly what the exchange rate signifies in terms of which currency is the denominator. b. watch for ways the currency might lose value. c. learn about recent behavior of the exchange rate. d. know exactly what the rate is at any moment in time.
In the Keynesian model, the full-employment level of output is the amount of output produced when
A) the quantity of labor demanded equals the quantity of labor supplied. B) the market wage exceeds the efficiency wage. C) labor is paid an efficiency wage, and the real wage equals the marginal product of labor. D) the real wage exceeds the nominal wage.