Refer to Figure 2-8. Suppose Vidalia is currently producing 120 dozen roses per period. How many orchids is it also producing, assuming that resources are fully utilized?

A winter ice storm has paralyzed the entire east coast, reducing productivity sharply. This supply shock shifts the marginal product of labor curve

A) up and to the right, raising the quantity of labor demanded at any given real wage. B) down and to the left, reducing the quantity of labor demanded at any given real wage. C) up and to the right, reducing the quantity of labor demanded at any given real wage. D) down and to the left, raising the quantity of labor demanded at any given real wage.

When individuals make decisions about how much money and bonds to hold, which of the following variables affects those decisions?

A) the real interest rate only B) the nominal interest rate only C) the expected inflation rate only D) either the real interest rate or the expected inflation rate E) both the nominal and real interest rates