Question

Policies that make it more difficult to fire an employee likely lead to: Multiple Choice 0 less unemployment, because everyone will value their job more. 0 greater unemployment, because employees will quit more often. 0 less unemployment, because employers will not be able to fire as many people. 0 greater unemployment, because employers will be more hesitant to hire someone.

Answer 1

Question 1

If government implement policy that make it difficult for an employer to fire an employee then, in that case, employer will be hesitant to hire new employees as firing such employees would be difficult, even if, their performance is not satisfactory.

This will result in higher unemployment as fewer people would be able to secure job.

Hence, the correct answer is the option (d) [Greater unemployment, because employers will be more hesistant to hire someone].

Question 2

Growth accounting is technique that helps in estimation of the contribution of various factors of production towards economic growth.

In indirect manner, it also help in assesment of the contribution of technology in economic growth.

Hence, the correct answer is the option (c) [Technology].

Question 3

If aggregate demand curve shifts to the left in the short run then, in that case, in short run, there is fall in price level and the level of output.

This will create unemployment leading to fall in wage rate.

This will reduce the cost of production for firms and enable them to increase production and supply. Overtime, the short-run aggregate supply will shift to the right.

So, in long-run equilibrium, price level will reduce further and economy will move to its potential output level.

Hence, the correct answer is the option (b) [Lower price level and same level of output].