The extent to which the diffusion of new technology results in increased employment depends upon the extent to which the wage-setting curve shifts upwards. Which of the following might encourage this upward shift?

a.The new technology weakens the bargaining position of trade unions.

b.Employees find the new working conditions more attractive than the old

c.The government introduces more generous unemployment benefits to compensate those losing their jobs.

d.Government reduces the scope of employment protection measures.

In an economy with no taxation and no external trade, the size of the multiplier depends on:

a.Imports

b.Marginal propensity to consume

c.Government spending

d.Investment

10 years ago, a growing economy enjoyed an increase in GDP of $1,000 per worker per year when net investment increased the capital available to each worker by 5,000. The same level of net investment last year was followed by an increase in GDP of $800. Which of the following describes the situation?

a.The marginal product of capital is rising.

b.GDP is falling.

c.Investment is falling

d.The marginal product of capital is falling.