Exam 7: The Economy at Full Employment

What was observed about labor markets during the Great Depression that was not explained by classical models? This was also what most models developed after the Great Depression tried to explain.

A tax on labor causes a smaller drop in equilibrium wages when:

"Diminishing returns to labor occurs additional units of labor decreases total production." Do you agree or disagree? Explain.

Figure 7.4 -From Figure 7.4, crowding in did not occur between:

What happens to the equilibrium wage rate in the US and Canada when more Canadian workers migrate to the United States?

Figure 7.1 -Please refer to Figure 7.1. Suppose the economy is at point D. A health pandemic that results in the loss of the lives to countless workers will:

Which of the following must be true when it is observed that government spending is causing crowding out?

Figure 7.1 -Please refer to Figure 7.1. Suppose the economy is at point D. A war that destroys factories will:

According to the real business cycle theory, shocks to aggregate demand and shocks to aggregate supply both cause fluctuations in output.

The real wage is the wage rate to employees adjusted for:

The level of full- employment output in an economy increases as:

Which of the following would not be considered part of the stock of capital?

Which of the following would not cause an increase in output?

An increase in the productivity of workers shifts the labor _______ curve to the _______.

If the real business cycle theory were correct, then the recession that the U.S. experienced in 2008 was caused by:

Figure 7.1 -Please refer to Figure 7.1. The production function that passes through points A and B exhibits

In macroeconomics, the term "classical" refers to a school of economics that believed that

When constructing a production function between labor and output, which is drawn on the x- axis?

The horizontal axis of the production function typically measures:

Recall Application 1, "The Black Death and the Living Standards in Old England," to answer the following questions: -From the application, if the industrial revolution occurred right around the time of the bubonic plague, then we would expect to see the real wage rate of laborers in England to be: