Refer to the scenario above. Suppose the economy is currently operating on the production function F2 and E2 is the level of employment in the country. If the demand curve for labor shifts to the left, ________
A) employment will remain unchanged at E1 B) output will increase from Y2 to Y3
C) employment will decrease from E2 to E1 D) employment will increase from E2 to E3
C
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One economic advantage of a large share of exports in GDP is that countries
A) can reduce their budget deficits. B) can purchase the imports they need. C) can maintain lower rates of unemployment. D) will have greater equality in their incomes. E) develop more labor-intensive industry.
Because firms in perfectly competitive markets can sell any quantity without driving down prices, they should:
A. produce as much as possible to maximize profits. B. produce at the lowest cost per unit to maximize profits. C. increase quantity until the additional profit it earns on its last unit sold is zero. D. try to flood the market.