Which of the following examples shows how advertising can create greater elasticities of demand?
a. Ads claim that one cell phone is by far better than all the competitors’ cell phones.
b. Ads show that most car companies reduce prices for their products during the fall.
c. Ads show how several paper towel brands are better than the established paper towel brand.
d. Ads reveal how a particular brand of detergent is inferior.
c. Ads show how several paper towel brands are better than the established paper towel brand.
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Assume the government reduces your welfare check by $1 for every $2 that you earn on the job while on welfare. How will this tax affect your labor supply decisions? What is the implicit tax rate of such a policy?
What will be an ideal response?
Which of the following examples would illustrate a backward-sloping labor supply-curve?
a. An increase in a person's wages results in the person working fewer hours per week. b. A decrease in a person's wages results in the person working more hours per week. c. An increase in a person's wages results in the person working more hours per week. d. Both a and b are correct.