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21) A sudden increase in the demand for air conditioners increased...

21) A sudden increase in the demand for air conditioners increased the earnings of the workers employed in air conditioner-manufacturing firms and attracted workers from other sectors. Which of the following will be true in the market for workers employed in air conditioner-manufacturing firms?


  • ​There will be a leftward shift of the labor supply curve, leading to an increase in the equilibrium wage and a decrease in employment.


  • ​There will be a rightward shift of the labor supply curve, leading to an increase in the equilibrium wage and employment.


  • ​There will be a rightward shift of the labor supply curve, leading to a decrease in the equilibrium wage and an increase in employment.


  • ​There will be a leftward shift of the labor supply curve, leading to a decrease in the equilibrium wage and employment.
  • 22) Which of the following is a difference between liberalism and libertarianism?​

  • ​Libertarians argue that the government should maximize total utility, while liberals argue that the average utility of members of society should be maximized.


  • ​Libertarians emphasize the importance of the maximin criterion, while liberals emphasize the importance of an egalitarian society. 


  • ​Libertarians believe that the government should redistribute income from the rich to the poor, while the liberals believe that the government should not redistribute income.


  • ​Libertarians believe that equality of opportunities is more important than the equality of incomes, while liberals believe in policies that equalize the distribution of income.
  • 23) A perfectly competitive firm sells 10 units of Good X at a price of $2 per unit. It incurs a fixed cost of $5 and a variable cost of $40 to produce the good. Which of the following is true?​

  • ​The average revenue of the firm is $20. 


  • ​The marginal cost of the good is $4.


  • ​The firm should shut down.


  • ​The firm should operate in the short run but shut down in the long run.

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