The labor supply curve facing a monopsonist is:

The labor supply curve facing a monopsonist is:
 a. downward sloping.
  b. upward sloping.
  c. a horizontal line.
  d. backward bending.
  e. a vertical line.

QUESTION 2

Suppose the federal government increases the unemployment benefits financed by higher income taxes. In this case, which of the following is likely to occur?
 a. An increase in the equilibrium real GDP
 b. A redistribution of disposable income from the employed to the unemployed
  c. An increase in the interest rate
 d. An increase in the discount rate charged by the Central Bank
 e. An increase in the income of the rich and a decrease in the income of the poor

QUESTION 3

If a town has a monopsony, this means:
 a. there is only one employer.
  b. price discrimination takes place.
  c. goods are priced too high.
  d. no unions can exist.
  e. excess profits are being made

QUESTION 4

If the consumer price index (CPI) is 220 one year and 210 the next, the annual rate of inflation as measured by the CPI is approximately _____.
 a. 2.3 percent
  b. 4.6 percent
  c. 10 percent
 d. 4.8 percent
 e. 220 percent

QUESTION 5

Suppose the government increases unemployment benefits, which are paid for with higher taxes on earnings. If the marginal propensity to consume is the same for both the beneficiaries of the unemployment benefits and the workers paying taxes, _____.
 a. GDP will first increase and then fall.
  b. There will be no change in real GDP.
  c. Real GDP will increase substantially.
  d. Real GDP will fall substantially.
 e. GDP will first fall and then increase.