Question 1

A firm's demand for labor curve

Accepted Answer

A)   is the same as its value of marginal product of labor curve.
B)   shows how many jobs the firm demands at different wage rates.
C)   shifts rightward when the price of the firm's output falls.
D)   None of the above answers are correct.E) A) and D)
F) None of the above

Question 2

The demand for labor increases (that is, the demand for labor curve shifts rightward)  if the

Accepted Answer

A)   wage rate increases.
B)   wage rate decreases.
C)   price of the firm's output rises.
D)   price of the firm's output falls.E) B) and C)
F) All of the above

Question 3

If a union successfully restricts the supply of labor to the firm but the union has no effect on the demand for labor, then the

Accepted Answer

A)   wage increases and there is no change in employment.
B)   wage increases and employment increases.
C)   wage increases and employment decreases.
D)   wage increases and there is an unambiguous effect on employment.E) B) and C)
F) All of the above

Question 4

The interest rate is 5 percent. How does $500 to be received a year from today compare in value to $500 right now?

Accepted Answer

With an interest rate of 5 percent, $500...

Question 5

Intel hired a consultant who found that the value of marginal product of Intel's workers decreased as more workers were hired. Suppose Intel is a monopolistically competitive firm. Then the value of marginal product decreases because the I. workers' marginal product of labor decreased as more workers were hired.
II)  marginal revenue of Intel's chips decreased as more chips were sold.

Accepted Answer

A)   I only
B)   II only
C)   Both I and II
D)   Neither I nor IIE) A) and C)
F) All of the above

Question 6

For a monopsony, the marginal cost of labor is ________ the wage rate.

Accepted Answer

A)   greater than
B)   less than
C)   equal to
D)   first greater than and later less thanE) All of the above
F) C) and D)

Question 7

A firm's demand for labor curve is the same as the firm's

Accepted Answer

A)   marginal product curve.
B)   marginal cost curve.
C)   marginal revenue curve.
D)   value of marginal product curve.E) B) and C)
F) C) and D)

Question 8

Joe manages a company that produces lawn mowers. Joe knows that the value of marginal product

Accepted Answer

A)   decreases as he hires more labor to produce lawn mowers.
B)   does not change as he sells more lawn mowers.
C)   increases as he hires more labor to produce lawn mowers.
D)   increases as he sells more lawn mowers.E) All of the above
F) B) and D)

Question 9

In comparison to an employer in a competitive labor market, a monopsony employer hires ________ workers and produces ________ output.

Accepted Answer

A)   fewer; less
B)   fewer; more
C)   more; less
D)   more; moreE) A) and D)
F) B) and D)

Question 10

-The above table has the total product schedule for Joe's Barber Shop. Joe charges $6 per haircut. If the wage rate falls from $24 per worker to $12 per worker, the quantity of labor hired ________ and the new number of workers employed is ________.

Accepted Answer

A)   increases; 2
B)   decreases; 2
C)   increases; 5
D)   increase; 3E) B) and C)
F) C) and D)

Question 11

-The preceding table gives monthly production information for Peter's Peanuts, a firm in a perfectly competitive industry. An increase in the wage rate for labor leads to

Accepted Answer

A)   an increase in the quantity of labor demanded.
B)   a decrease in the quantity of labor demanded.
C)   an increase in the demand for labor.
D)   a decrease in the demand for labor.E) All of the above
F) A) and D)

Question 12

The firm's demand for labor is derived directly from

Accepted Answer

A)   the wage rate.
B)   the supply of labor.
C)   labor's cost.
D)   labor's value of marginal product.E) A) and B)
F) C) and D)

Question 13

Which of the following decreases the supply of labor that competes with union labor?

Accepted Answer

A)   an increase in the minimum wage
B)   an increase in the demand for imported goods
C)   new laws that restrict immigration
D)   All of the above would cause a decrease in the supply of labor that competes with union labor.E) B) and D)
F) B) and C)

Question 14

If the interest rate is 20 percent, $100 to be received four years from today has a present value of approximately

Accepted Answer

A)   $48.
B)   $69.
C)   $80.
D)   $100.E) A) and B)
F) All of the above

Question 15

Because a monopsony is the only buyer in a particular market, the

Accepted Answer

A)   supply of labor to the monopsony is perfectly elastic.
B)   supply of labor to the monopsony is perfectly inelastic.
C)   supply of labor curve faced by the monopsony is upward sloping.
D)   supply of labor curve faced by the monopsony is downward sloping.E) B) and C)
F) A) and B)

Question 16

S & S Backhoe Service in Ozark, Arkansas rents backhoes and other heavy equipment to local construction companies. What determines the demand for backhoes in Arkansas?

Accepted Answer

A)   The rental rate for backhoes
B)   The equilibrium quantity of backhoes
C)   The value of marginal product of backhoes
D)   The maximum number of backhoes available to rentE) B) and C)
F) A) and D)

Question 17

A company finds that for the next worker hired, the worker's VMP is less than the cost of the worker. In this case, to maximize its profit the company should

Accepted Answer

A)   definitely hire the worker.
B)   perhaps hire the worker, depending on the relationship between the company's MC and MR.
C)   definitely not hire the worker.
D)   None of the above answers is correct.E) A) and D)
F) None of the above

Question 18

0 to LS1. The wages of fast-food workers A)  decrease by $4 per hour. B)  decrease by $10 per hour. C)  increase by $4 per hour. D)  remain the same." class="answers-bank-image d-inline" rel="preload" >
-The figure above shows the labor demand and labor supply curves for workers in local fast-food restaurants. The fast-food restaurant industry is competitive. A decrease in the supply of labor shifts the labor supply curve from LS0 to LS1. The wages of fast-food workers

Accepted Answer

A)   decrease by $4 per hour.
B)   decrease by $10 per hour.
C)   increase by $4 per hour.
D)   remain the same.E) All of the above
F) A) and B)

Question 19

The demand for labor depends on I. technology.
II)  the prices of other factors of production.
III)  the price of the product.

Accepted Answer

A)   I and II
B)   II and III
C)   I and III
D)   I, II and IIIE) A) and B)
F) A) and C)

Question 20

If a nonrenewable natural resource's price is expected to increase at a rate faster than the interest rate, then the supply today will

Accepted Answer

A)   the supply today will increase.
B)   the supply today will decrease.
C)   the demand today will decrease.
D)   the price today will fall.E) A) and B)
F) All of the above

Exam 18: Markets for Factors of Production

The firm's demand for labor is derived directly from

Correct Answer
verified

The interest rate is 5 percent. How does $500 to be received a year from today compare in value to $500 right now?

Correct Answer
verified
With an interest rate of 5 percent, $500...
View Answer

If a nonrenewable natural resource's price is expected to increase at a rate faster than the interest rate, then the supply today will

Correct Answer
verified

If a union successfully restricts the supply of labor to the firm but the union has no effect on the demand for labor, then the

Correct Answer
verified

Which of the following decreases the supply of labor that competes with union labor?

Correct Answer
verified

If the interest rate is 20 percent, $100 to be received four years from today has a present value of approximately

Correct Answer
verified

-The above table has the total product schedule for Joe's Barber Shop. Joe charges $6 per haircut. If the wage rate falls from $24 per worker to $12 per worker, the quantity of labor hired and the new number of workers employed is .

Correct Answer
verified

-The preceding table gives monthly production information for Peter's Peanuts, a firm in a perfectly competitive industry. An increase in the wage rate for labor leads to

Correct Answer
verified

S & S Backhoe Service in Ozark, Arkansas rents backhoes and other heavy equipment to local construction companies. What determines the demand for backhoes in Arkansas?

Correct Answer
verified

For a monopsony, the marginal cost of labor is ________ the wage rate.

Correct Answer
verified

Correct Answer
verified

The demand for labor depends on I. technology. II) the prices of other factors of production. III) the price of the product.

Correct Answer
verified

Because a monopsony is the only buyer in a particular market, the

Correct Answer
verified

A firm's demand for labor curve is the same as the firm's

Correct Answer
verified

-The figure above shows the labor demand and labor supply curves for workers in local fast-food restaurants. The fast-food restaurant industry is competitive. A decrease in the supply of labor shifts the labor supply curve from LS₀ to LS₁. The wages of fast-food workers

Correct Answer
verified

The demand for labor increases (that is, the demand for labor curve shifts rightward) if the

Correct Answer
verified

Joe manages a company that produces lawn mowers. Joe knows that the value of marginal product

Correct Answer
verified

In comparison to an employer in a competitive labor market, a monopsony employer hires workers and produces output.

Correct Answer
verified

A firm's demand for labor curve

Correct Answer
verified

A company finds that for the next worker hired, the worker's VMP is less than the cost of the worker. In this case, to maximize its profit the company should

Correct Answer
verified

Exam 18: Markets for Factors of Production

The firm's demand for labor is derived directly from

Correct AnswerverifiedShow Answer

The interest rate is 5 percent. How does $500 to be received a year from today compare in value to $500 right now?

Correct AnswerverifiedWith an interest rate of 5 percent, $500...View AnswerShow Answer

If a nonrenewable natural resource's price is expected to increase at a rate faster than the interest rate, then the supply today will

Correct AnswerverifiedShow Answer

If a union successfully restricts the supply of labor to the firm but the union has no effect on the demand for labor, then the

Correct AnswerverifiedShow Answer

Which of the following decreases the supply of labor that competes with union labor?

Correct AnswerverifiedShow Answer

If the interest rate is 20 percent, $100 to be received four years from today has a present value of approximately

Correct AnswerverifiedShow Answer

-The above table has the total product schedule for Joe's Barber Shop. Joe charges $6 per haircut. If the wage rate falls from $24 per worker to $12 per worker, the quantity of labor hired ________ and the new number of workers employed is ________.

Correct AnswerverifiedShow Answer

-The preceding table gives monthly production information for Peter's Peanuts, a firm in a perfectly competitive industry. An increase in the wage rate for labor leads to

Correct AnswerverifiedShow Answer

S & S Backhoe Service in Ozark, Arkansas rents backhoes and other heavy equipment to local construction companies. What determines the demand for backhoes in Arkansas?

Correct AnswerverifiedShow Answer

For a monopsony, the marginal cost of labor is ________ the wage rate.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The demand for labor depends on I. technology. II) the prices of other factors of production. III) the price of the product.

Correct AnswerverifiedShow Answer

Because a monopsony is the only buyer in a particular market, the

Correct AnswerverifiedShow Answer

A firm's demand for labor curve is the same as the firm's

Correct AnswerverifiedShow Answer

-The figure above shows the labor demand and labor supply curves for workers in local fast-food restaurants. The fast-food restaurant industry is competitive. A decrease in the supply of labor shifts the labor supply curve from LS0 to LS1. The wages of fast-food workers

Correct AnswerverifiedShow Answer

The demand for labor increases (that is, the demand for labor curve shifts rightward) if the

Correct AnswerverifiedShow Answer

Joe manages a company that produces lawn mowers. Joe knows that the value of marginal product

Correct AnswerverifiedShow Answer

In comparison to an employer in a competitive labor market, a monopsony employer hires ________ workers and produces ________ output.

Correct AnswerverifiedShow Answer

A firm's demand for labor curve

Correct AnswerverifiedShow Answer

A company finds that for the next worker hired, the worker's VMP is less than the cost of the worker. In this case, to maximize its profit the company should

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
With an interest rate of 5 percent, $500...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

-The above table has the total product schedule for Joe's Barber Shop. Joe charges $6 per haircut. If the wage rate falls from $24 per worker to $12 per worker, the quantity of labor hired and the new number of workers employed is .

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

-The figure above shows the labor demand and labor supply curves for workers in local fast-food restaurants. The fast-food restaurant industry is competitive. A decrease in the supply of labor shifts the labor supply curve from LS₀ to LS₁. The wages of fast-food workers

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

In comparison to an employer in a competitive labor market, a monopsony employer hires workers and produces output.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified