One reason nonunionized firms do not always drive unionized firms out of business is that:
A. unionized firms hire more selectively, employing workers with greater human capital.
B. unionized firms reduce the value of total output.
C. markets are not competitive.
D. unionized firms receive government subsidies.
Answer: A
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Which of the following isnot a reason why the aggregate-demand curve slopes downward?
A. the interest-rate effect B. All of these answers are reasons why the aggregate-demand curve slopes downward. C. the wealth effect D. the exchange-rate effect E. the classical dichotomy/monetary neutrality effects
Suppose a tax of $4 per unit is imposed on a good, and the tax causes the equilibrium quantity of the good to decrease from 2,000 units to 1,700 units. The tax decreases consumer surplus by $3,000 and decreases producer surplus by $4,400 . The deadweight loss of the tax is
a. $200. b. $400. c. $600. d. $1,200.