When indifference curves are bowed inward, the marginal rate of substitution varies at each point on the indifference curve

If the index of leading indicators and other forecasting devices suggested that the economy is moving into an inflationary boom, activists' economic policy would call for

a. a decrease in money supply growth and a tax increase. b. an increase in money supply growth and a shift toward a budget deficit. c. an increase in money supply growth and a tax decrease. d. a continuation of the policies already in place.

Suppose that air traffic controllers, whose wages have been locked into place by a two-year contract, are laid off during a recession. This example is consistent with the

A. efficiency wage explanation of unemployment. B. explicit contract explanation of unemployment. C. relative-wage explanation of unemployment. D. social contract explanation of unemployment.