When there are diminishing marginal returns to labor, the marginal product of the last worker hired must be negative

The largest single portion of state and local budgets is devoted to

a. State and local defense. b. Health and public welfare programs. c. State and local unemployment compensation. d. Education. e. Interest payments on state and local debt.

Last year the Olsen family earned $70,000. This year their income is $77,000. In an economy with an inflation rate of 8 percent, we can conclude that the Olsen's nominal income:

A. and real income both increased. B. and real income both decreased. C. increased, but their real income decreased. D. decreased, but their real income increased.