Macroeconomists test their theories using controlled economy-wide experiments of various kinds

Refer to Table 4-7. Suppose that the quantity of labor supplied decreases by 80,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?

A) W = $8.50; Q = 550,000 B) W = $11.50; Q = 610,000 C) W = $12.50; Q = 550,000 D) W = $8.50; Q = 630,000

When taxes increase, the interest rate

a. increases, making the change in aggregate demand larger. b. increases, making the change in aggregate demand smaller c. decreases, making the change in aggregate demand larger. d. decreases, making the change in aggregate demand smaller.