Given the desire of politicians to get reelected, they might try in the short run to use _____.
a. a contractionary monetary policy
b. an expansionary fiscal policy
c. an expansionary monetary policy
d. tax increases
e. automatic stabilizers to control demand
Question 2
The supply curve that monopsonists face is different from the supply curves that firms in competitive labor markets face because with a monopsony,
a. d and e.
b. the supply curve of labor is relatively flat.
c. offering a wage lower than the market wage means having no workers.
d. the employer faces the market supply curve.
e. the firm does not take the wage as given.
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