Which of the Following Is Likely to Be True of an Economy

question 41

Multiple Choice

Which of the following is likely to be true of an economy that has a very high labour participation rate?

• A) There is a high level of unemployment in the economy.
• B) The levels of literacy in the economy are likely to be low.
• C) The economy is likely to be highly reliant on labour to generate economic growth.
• D) The economy has a large working age population.

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Definitions:

Long-Run Equilibrium

A state in which all factors of production and inputs in a market are fully adjusted to any economic changes, showing no tendency for further adjustment.

Competitive Price-Searcher Market

A market in which the firms have a downward-sloping demand curve, and entry into and exit from the market are relatively easy.

Positive Economic Profit

Earnings that exceed both the explicit and implicit costs of a company, indicating a financial gain beyond the normal expectations of profit.

Maximum Economic Profit

The highest possible financial gain obtainable by a firm when total revenue exceeds both explicit and implicit costs.