Suppose That in the Economy in General Efficiency Wages Become

question 208

Multiple Choice

Suppose that in the economy in general efficiency wages become more common.Economists would predict that this would

• A)increase the quantity demanded and decrease the quantity supplied of labor thereby decreasing the natural rate of unemployment.
• B)decrease the quantity demanded and increase the quantity supplied of labor thereby increasing the natural rate of unemployment.
• C)increase the quantity demanded and decrease the quantity supplied of labor thereby increasing the natural rate of unemployment.
• D)decrease the quantity demanded and increase the quantity supplied of labor thereby decreasing the natural rate of unemployment.

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Definitions:

Long Run

A period in economics where all inputs or factors of production can be varied, with no fixed factors, allowing for full adjustment to changes.

Economic Profit

The divergence between overall financial returns and comprehensive expenses, integrating both apparent and implied costs.

Long Run

In economics, a period in which all factors of production and costs are variable, allowing all inputs to be adjusted.

Average Variable Cost

The total variable costs of production divided by the quantity of output produced, representing the cost per unit of output.