The sum of the marginal propensity to consume and the marginal propensity to save is always equal to

The figure above shows the labor market in a region. In which of the following cases would the amount of unemployment be the largest?

A) when the market is at its equilibrium, with no minimum wage B) when a minimum wage of $4 an hour is imposed C) when a minimum wage of $6 an hour is imposed D) when a minimum wage of $8 an hour is imposed E) None of the above because the market will adjust so that there is no unemployment.

Which of the following will cause a decrease in producer surplus?

a. the imposition of a binding price ceiling in the market b. an increase in the number of buyers of the good c. income increases and buyers consider the good to be normal d. the price of a complement decreases