Which scenario below most accurately describes the process by which a technological change can affect employment patterns across industries?
A) A technological advance makes it possible to produce more of good X with less labor. As a result, labor is released from producing good X. Some of this labor ends up producing goods Y and Z.
B) A technological advance makes it possible to produce less of good X with less labor. As a result, labor is released from producing good X. Some of this labor ends up producing good Y.
C) A technological advance makes it possible to produce more of good X with more labor. As a result, more labor is needed to produce good X. There is less labor available to produce goods Y and Z.
D) A technological advance makes it possible to produce more of good X with less labor. As a result, labor becomes more important to the production of good X. More labor ends up producing good X.
E) none of the above
A
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If the opportunity cost is constant (the PPF is a straight line), then a country will:
a. partially specialize in the production of its exported product. b. completely specialize in the production of its exported product. c. not benefit from importing goods from another country. d. benefit by raising trade barriers.
The positive relationship between short-run aggregate supply and the price level indicates that, in the short run
A) firms produce more output as the price level falls. B) firms produce more output as the price level rises. C) the money wage rate increases when moving along the short-run aggregate supply curve. D) lower price levels are more profitable for firms.