If the automobile workers' union successfully negotiates a wage increase for its members, how does the wage hike affect the supply of automobiles?
A) The supply increases.
B) The supply decreases.
C) The quantity supplied increases.
D) The quantity supplied decreases.
E) Both answers B and D are correct.
B
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In a closed economy, private saving is equal to which of the following? (Y = GDP, C = Consumption, G = Government purchases, T = Taxes, and TR = Transfers)
A) Y + TR - C - T B) Y - C - T C) Y - G - T + TR D) Y - G - T
Suppose the production function for good q is given by q = 3K + 2 L where K and L are capital and labor inputs. Consider three statements about this function: I. The function exhibits constant returns to scale. II. The function exhibits diminishing marginal productivities to all inputs. III. The function has a constant rate of technical substitution. Which of these statements is true?
a. All of them. b. None of them. c. I and II but not III. d. I and III but not II. e. only I.