A large number of firms in Richland sell energy drinks. However, each firm faces a downward sloping demand curve. The market for energy drinks in Richland is an example of a(n) ________

A 20 percent increase in the wage rate induces firms in an industry to reduce quantity demanded for labor by 5 percent in the first year. Five years later we would expect, other things constant,

A) the reduction in the quantity demanded of labor to be much greater than 5 percent. B) the reduction in the quantity demanded of labor to be less than 5 percent. C) the reduction in the quantity demanded of labor to be about 5 percent. D) the quantity demanded of labor to be back to its original level.

According to new classical economists, the most appropriate policy during a recession would be for the government to

a. increase the minimum wage. b. impose wage and price controls. c. cut taxes and increase the budget deficit. d. do nothing.