Question

When the prevailing market wage is above equilibrium, we say:

Question 25 options:

	there cannot be any unemployment.
	there is a shortage of labour.
	that such a situation could never exist.
	there is a surplus of labour.

An increase in productivity will cause the:

Question 26 options:

	short-run aggregate supply curve to shift to the right.
	a movement along the short-run aggregate supply curve.
	aggregate demand curve to shift to the right.
	long-run aggregate supply curve to shift to the left.

In financial markets, the practice of securitization:

Question 27 options:

	allowed investors to profit from the mortgage payments without being exposed to any risk.
	pooled high-risk mortgages together, which raised the prices of them to investors.
	involved converting private-sector equities into government securities
	pooled the risk of mortgages, allowing higher-risk mortgages to be (supposedly) more safely sold to investors.

If money has intrinsic value, it has:

Question 28 options:

	value only as its use as money.
	value unrelated to its use as money.
	value that is conferred by fiat.
	None of these is true.

Answer 1

Question 25 When the prevailing market wage is above equilibrium, quantity demanded of labor is less than its quantity supplied so that there is a shortage of jobs and surplus of workers. Select there is a surplus of labour.

Question 26. An increase in productivity will cause the more production with same resource. This implies that the production potential of economy rises.  Select long-run aggregate supply curve to shift to the left.

Question 27 In financial markets, the practice of securitization has financial institutions bundling home mortgages together and selling their shares to the investors in order to spreade the credit risk and reduce home mortgage interest rates. Select pooled the risk of mortgages, allowing higher-risk mortgages to be (supposedly) more safely sold to investors
Question 28. If money has intrinsic value, it has: Select value unrelated to its use as money