# The real wage is the wage a measured in current

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Chapter 7 / Exercise 7
Macroeconomics for Today
Tucker
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33. The real wage is the wage:A. measured in current dollars.B. required to maintain a minimum standard of living.C. employers are required to pay workers.@measured in terms of purchasing power.E. the federal government sets as the minimum wage.
34. Indexing is the process of:
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Chapter 7 / Exercise 7
Macroeconomics for Today
Tucker
Expert Verified
35. The substitution bias in the CPI refers to the failure of statisticians to:
Essay questions. Each one is worth 10 points.1.Suppose the nation with this production possibility curve receives a gift of newmachinery which doubles the maximum quantity of clothing it can produce. Draw thenew production possibility curve. Show how the nation can now produce and consumemore clothingandfood. Shade in the new combinations which are now possible.J0FoodQuantity Supplied20161284/0Clothing2. Graph the demand and supply curves for peaches. Show the equilibrium price andequilibrium quantity in this market.PriceQuantity Demanded\$1.002.806.6010.4014.20183.For each of the following, show with a graph whether it would lead to ashiftinthe demand curveor to achange in the quantity demandedof iPods: a) higher prices foriPod Nanos b) higher household incomes c) lower costs to make iPods d) a decrease inprices of iPods e) cheaper music downloads5.Define Gross Domestic Product. What are some of the weaknesses of using GDPto measure a nation's economic activity and to compare one year to another?4.Underwhatcircumstancescoulda governmentunintentionallycausea!"shortage"of a goodor service?Howcouldit causea "surplus"?Drawr'Usupply / demand diagrams to illustrate your answer.1'7
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