Holding Other Factors Constant, If Computers Allow Factory Workers to Manufacture

question 7

Multiple Choice

Holding other factors constant, if computers allow factory workers to manufacture more products per hour, then the real wages of factory workers will ________ and employment of factory workers will ________.

• A)increase; increase
• B)increase; decrease
• C)decrease; not change
• D)decrease; increase

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Definitions:

Coupon Rate

The percentage of a bond's face value that is annually paid as interest by the bond.

Par Value

The nominal value of a bond or the stated value of stock as documented in the company's charter, frequently utilized in official paperwork.

Ask Price

The lowest price a seller is willing to accept for an asset in the financial markets; it contrasts with the bid price, which is the highest price a buyer is willing to pay.

Coupon Bond

A type of bond that provides periodic interest payments to its holder, based on a fixed interest rate (coupon rate) until its maturity, at which point the principal amount is repaid.