Suppose a Country Imposes New Restrictions on How Many Hours

question 133

Multiple Choice

Suppose a country imposes new restrictions on how many hours people can work.If these restrictions reduce the total number of hours worked in the economy,but all other factors that determine output are held fixed,then

• A)productivity and output both rise.
• B)productivity rises and output falls.
• C)productivity falls and output rises.
• D)productivity and output fall.

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Definitions:

Economic Profit

A financial gain that exceeds both the explicit and implicit costs associated with business operations.

Natural Monopolist

A firm that can supply the entire market at a lower cost than any combination of two or more smaller firms, often due to economies of scale.

Maximum Price

A price ceiling set by authorities to prevent prices from going above a certain level, often to make goods affordable.

Pure Monopolist

A market structure wherein a single company exclusively controls the entire market for a particular good or service, facing no competition.