In 18th century Europe, governments gave guilds legal authority to limit production of goods. How did this authority either obstruct or improve the market mechanism?
A) It obstructed the market mechanism because with one more party having to coordinate activities (the guilds) there were delays in getting the products to consumers.
B) It improved the market mechanism because the government's actions provided the correct set of signals to the market so that producers can adjust their output to better meet the needs of consumers.
C) It improved the market mechanism by making it more efficient because the guilds were able to quickly identify and rectify any market shortages and surpluses.
D) It obstructed the market mechanism because the guild's actions prevented the forces of demand and supply from coordinating the self-interested decisions of producers and consumers.
D
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When a minimum wage is introduced ________ the equilibrium wage rate, the quantity of labor demanded ________ and the quantity of labor supplied ________, thus creating unemployment
A) above; increases; decreases B) below; increases; decreases C) above; decreases; increases D) above; decreases; decreases E) below; decreases; decreases
One way to achieve faster growth in GDP per person is to increase the
A) number of women working in the home rather than in the workforce. B) growth rate of the quantity of money. C) growth rate of human capital. D) growth rate of the population. E) limits on international trade in order to keep more of total spending on domestically produced goods.