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A)In the classical model if there is a decrease in capital stock, what are the effects on labor demand, real wages, and output? (increase or decrease)
B) What are the effects if the population decreases?
 

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Chika Ilonah
Chika IlonahLv10
28 Sep 2019

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Related questions

If aggregate demand increases and aggregate supply decreases, the price level

a) and real output will both increase.

b) and real output will both decrease.

c) will decrease, but the real output may increase, decrease, or remain unchanged.

d)  will increase, but the real output may increase, decrease, or remain unchanged 

 

1.In the classical macroeconomic model, a decrease in the real wage would cause

A)a decrease in the marginal product of labor and an increase in the quantity demanded for labor.

B)an increase in the marginal product of labor and an increase in the quantity demanded for labor.

C)no change in the quantity demanded for labor.

D) an increase in both the supply of and demand for labor.

4.A profit-maximizing firm hires labor until

A)the price of output equals the price of labor.

B)the price of output equals the marginal product of labor

C)the real wage equals the marginal product of labor.

D)the real wage equals the marginal product of labor multiplied by the price of output.

6.In the classical model, the level of business investment was a function of

A)only the expected profitability of investment projects.

B)only the real interest rate.

C)both the expected profitability of investment projects and the real interest rate.

D)None of the above

8. In the classical model, if money growth and velocity are constant, then:

A)the price level will rise at the rate of output growth.

B)the price level will be constant.

C)the price level will fall at the rate of output growth.

D) none of the above.

2. If wage rate decreases and income effect dominates substitution effects what will happen to the hours of work.

3. If the labor supply elasticity is equal to 0.3, then it means that:

A 10% increase in wages will __________________(increase/decrease) hours of work by__________(3%/0.3%).

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