The elasticity of demand for a product will be higher:
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The more available are substitutes for that product
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The more its buyers demand loyalty
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The more the product is considered a necessity by its buyers
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Protectionism in the international trade stands for:
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Semi-restricted Trade
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Free trade policy
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Restricted Trade policy
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Which of the following cannot be used to justify efficiency wages
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Sticky price(menu cost) models
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Turnover costs
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Worker shirking
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The book ‘Asian Drama’ was written by
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A.C Pigou
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D.Ricardov
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Gunnar Myrdal
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Deductive method
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Moves from general to particular
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Moves from particular to general
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Is based on hypothesis
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New Keynesian theories of efficiency wages imply
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Voluntary unemployment
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Real wage rigidity
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Changes in unemployment represent changes in the natural rate of unemployment
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According to real business cycle theory an increase in taxes
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Would significantly reduce labor supply, increase employment, and decrease output
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A decline in employment but not in output
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Would significantly reduce labor supply, decrease employment, and decrease output
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In any efficiency wage model it must be true that
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The marginal benefit of increased efficiency is equal to the marginal cost of higher wages
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Nominal wages are inflexible
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Disequilibrium in the labor market exists
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All of the above
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In real business cycle models and new classical models
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Monetary factors are responsible for fluctuations in output and employment
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Changes in unemployment are involuntary
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Markets always clear
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Prices and wages are perfectly flexible
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A demand curve which takes the form of horizontal line parallel to quantity axis illustrates elasticity which is:
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Zero
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Infinite
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Greater than one
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