A minimum wage increases unemployment by
A) increasing the quantity of labor demanded.
B) decreasing the quantity of labor demanded.
C) shifting only the labor supply curve rightward.
D) shifting only the labor demand curve leftward.
E) shifting the labor supply curve rightward and shifting the labor demand curve leftward.
B
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Which of the following is NOT an important factor affecting economic growth?
A. the rate of growth of capital B. the growth of leisure C. the rate of growth in labor productivity D. the rate of saving
Refer to the above figure. The government has just engaged in expansionary fiscal policy shifting the aggregate demand curve from AD1 to AD2. Interest rates have started to rise. Which of the following statements is TRUE in the short run?
A. Real GDP will fall back to $11 trillion since the effect that increased government spending has on real GDP is short lived. B. Real GDP will end up somewhere between $11 and $14 trillion as businesses and consumers reduce their spending in response to the increase in interest rates. C. Real GDP will go beyond $14 trillion as businesses and consumers react to the increase in interest rates. D. Real GDP will be $14 trillion since the effect of government spending is not influenced by interest rates.