An Economic Boom in China Is Likely to Lead to A(n)

question 17

Multiple Choice

An economic boom in China is likely to lead to a(n) :

• A)​decrease in U.S.exports and U.S.aggregate demand.
• B)​increase in U.S.exports and U.S.aggregate demand.
• C)​decrease in U.S.imports and U.S.aggregate demand.
• D)​increase in U.S.imports and U.S.aggregate demand.

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Definitions:

Real Wages

The purchasing power of wages, reflecting the quantity of goods and services that can be bought with wages after adjusting for inflation.

Purely Competitive

A market structure characterized by many buyers and sellers, free entry and exit, and a homogenous product.

Labor Demand Curve

A graphical representation that illustrates the quantity of labor that employers are willing and able to hire at different wage rates.

Marginal Labor Cost

The additional cost incurred by hiring an extra unit of labor.