Question 1

If the wages of a dentist increase,

Accepted Answer

A)   so does her opportunity cost of leisure.
B)   her hours of labor supplied may increase.
C)   her hours of labor supplied may decrease.
D)   All of the above are correct.E) All of the above
F) A) and B)

Question 2

The purchase price of capital is

Accepted Answer

A)   the value of the capital to the firm.
B)   always less than the rental price.
C)   the price received from the flow of some capital services.
D)   the price a person pays to own that factor of production indefinitely.E) B) and D)
F) A) and D)

Question 3

Roxanne's hourly wage increases from $9 to $13. Which of the following describes a consequence of the increase in Roxanne's wage?

Accepted Answer

A)   The opportunity cost of Roxanne's leisure time has increased.
B)   Roxanne may choose to work fewer hours due to the increase in her wage.
C)   If Roxanne's labor supply curve is upward sloping, she will choose to work fewer hours.
D)   Both a and b are correct.E) B) and D)
F) A) and B)

Question 4

If the price of Verizon cell phones falls, what will happen to the demand curve for Verizon sales people?

Accepted Answer

A)   It will shift to the right.
B)   It will shift to the left.
C)   The direction of the shift is ambiguous.
D)   It will remain unchanged.E) All of the above
F) None of the above

Question 5

Table 18-1
 
-Refer to Table 18-1. Suppose that the firm pays its workers $80 per day. Each unit of output sells for $15. How many days of labor should the firm hire?

Accepted Answer

A)   3
B)   4
C)   5
D)   6E) None of the above
F) B) and D)

Question 6

Suppose the supply of capital decreases. As a result, the quantity of capital used in production and the rental price of capital will both fall.

Accepted Answer

A) True 
 B)False

Question 7

Fiona's hourly wage decreases from $10 to $8. Which of the following describes a consequence of the decrease in Fiona's wage?

Accepted Answer

A)   The opportunity cost of Fiona's leisure time has decreased.
B)   Fiona may choose to work more hours due to the decrease in her wage.
C)   Fiona may choose to work fewer hours due to the decrease in her wage.
D)   All of the above are correct.E) A) and B)
F) C) and D)

Question 8

In 2012, the total income of all U.S. residents was approximately $120 billion.

Accepted Answer

A) True 
 B)False

Question 9

Competitive firms decide how much output to sell by producing output until the price of the good equals

Accepted Answer

A)   marginal product.
B)   the value of marginal product.
C)   marginal cost.
D)   marginal profit.E) None of the above
F) A) and C)

Question 10

The current value of the marginal product of land influences the

Accepted Answer

A)   demand for land.
B)   equilibrium rental price of land.
C)   equilibrium purchase price of land.
D)   all of the above.E) A) and B)
F) None of the above

Question 11

Which of the following events could increase the demand for labor?

Accepted Answer

A)   A decrease in output price
B)   A decrease in the amount of capital available for workers to use
C)   An increase in the marginal productivity of workers
D)   A decrease in the wage paid to workersE) All of the above
F) A) and D)

Question 12

Harold owns a cranberry bog in which he grows cranberries. Harold's farm is a competitive, profit­maximizing firm. As such, Harold much decide (i)  how many cranberries to sell.
(ii)  what price to charge for his cranberries.
(iii)  what wages to pay his workers.
(iv)  how many workers to hire.

Accepted Answer

A)   (i)  only
B)   (ii)  and (iii)  only
C)   (i)  and (iv)  only
D)   (i) , (ii) , (iii) , and (iv) E) A) and C)
F) C) and D)

Question 13

Scenario 18-6
Rocchetta Industries manufactures and supplies bottled water in Mexico. As a result of a contamination of water supplies at many of Mexico's resort communities, the demand for bottled water has increased.
-Refer to Scenario 18-6. When the labor market adjusts to its new equilibrium, we would expect the

Accepted Answer

A)   marginal product of labor to be higher than it was before the increase in demand for bottled water.
B)   value of the marginal product of labor to be higher than it was before the increase in demand for bottled water.
C)   price of bottled water to be lower than it was before the increase in demand for bottled water.
D)   wages of Rocchetta workers to be lower than they were before the increase in demand for bottled water.E) C) and D)
F) A) and D)

Question 14

Table 18-7
 
-Refer to Table 18-7. What is the value of the cell labeled JJ?

Accepted Answer

A)   -$300
B)   -$200
C)   -$100
D)   $0E) A) and B)
F) A) and D)

Question 15

Labor-augmenting technological advances decrease the marginal productivity of labor.

Accepted Answer

A) True 
 B)False

Question 16

An increase in the supply of labor

Accepted Answer

A)   increases the equilibrium wage and increases the value of the marginal product of labor.
B)   increases the equilibrium wage and decreases the value of the marginal product of labor.
C)   decreases the equilibrium wage and increases the value of the marginal product of labor.
D)   decreases the equilibrium wage and decreases the value of the marginal product of labor.E) A) and B)
F) B) and D)

Question 17

The supply of labor in any one market depends on the opportunities available in other markets.

Accepted Answer

A) True 
 B)False

Question 18

A competitive, profit-maximizing firm hires labor up to the point at which the wage is equal to the .

Accepted Answer

value of t...

Question 19

Suppose XYZ Corporation is currently renting 300 units of capital at a rental price of $500 units per unit. The value of the marginal product of the 300th unit of capital is $400. How can the corporation increase its profit?

Accepted Answer

In view of the fact that the V...

Question 20

In a representative labor market,

Accepted Answer

A)   the wage adjusts to balance the supply and demand for labor.
B)   the wage equals the value of the marginal product of labor.
C)   an increase in the supply of labor increases the equilibrium wage.
D)   Both a and b are correct.E) B) and C)
F) A) and D)

Exam 18: The Markets for the Factors of Production

The current value of the marginal product of land influences the

Correct Answer
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An increase in the supply of labor

Correct Answer
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A competitive, profit-maximizing firm hires labor up to the point at which the wage is equal to the .

Correct Answer
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value of t...
View Answer

The supply of labor in any one market depends on the opportunities available in other markets.

Correct Answer
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Table 18-7 -Refer to Table 18-7. What is the value of the cell labeled JJ?

Correct Answer
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The purchase price of capital is

Correct Answer
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Suppose the supply of capital decreases. As a result, the quantity of capital used in production and the rental price of capital will both fall.

Correct Answer
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In 2012, the total income of all U.S. residents was approximately $120 billion.

Correct Answer
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Roxanne's hourly wage increases from $9 to $13. Which of the following describes a consequence of the increase in Roxanne's wage?

Correct Answer
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Suppose XYZ Corporation is currently renting 300 units of capital at a rental price of $500 units per unit. The value of the marginal product of the 300th unit of capital is $400. How can the corporation increase its profit?

Correct Answer
verified
In view of the fact that the V...
View Answer

Labor-augmenting technological advances decrease the marginal productivity of labor.

Correct Answer
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Table 18-1 -Refer to Table 18-1. Suppose that the firm pays its workers $80 per day. Each unit of output sells for $15. How many days of labor should the firm hire?

Correct Answer
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If the price of Verizon cell phones falls, what will happen to the demand curve for Verizon sales people?

Correct Answer
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If the wages of a dentist increase,

Correct Answer
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Harold owns a cranberry bog in which he grows cranberries. Harold's farm is a competitive, profitmaximizing firm. As such, Harold much decide (i) how many cranberries to sell. (ii) what price to charge for his cranberries. (iii) what wages to pay his workers. (iv) how many workers to hire.

Correct Answer
verified

Which of the following events could increase the demand for labor?

Correct Answer
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In a representative labor market,

Correct Answer
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Correct Answer
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Fiona's hourly wage decreases from $10 to $8. Which of the following describes a consequence of the decrease in Fiona's wage?

Correct Answer
verified

Competitive firms decide how much output to sell by producing output until the price of the good equals

Correct Answer
verified

Exam 18: The Markets for the Factors of Production

The current value of the marginal product of land influences the

Correct AnswerverifiedShow Answer

An increase in the supply of labor

Correct AnswerverifiedShow Answer

A competitive, profit-maximizing firm hires labor up to the point at which the wage is equal to the .

Correct Answerverifiedvalue of t...View AnswerShow Answer

The supply of labor in any one market depends on the opportunities available in other markets.

Correct AnswerverifiedShow Answer

Table 18-7 -Refer to Table 18-7. What is the value of the cell labeled JJ?

Correct AnswerverifiedShow Answer

The purchase price of capital is

Correct AnswerverifiedShow Answer

Suppose the supply of capital decreases. As a result, the quantity of capital used in production and the rental price of capital will both fall.

Correct AnswerverifiedShow Answer

In 2012, the total income of all U.S. residents was approximately $120 billion.

Correct AnswerverifiedShow Answer

Roxanne's hourly wage increases from $9 to $13. Which of the following describes a consequence of the increase in Roxanne's wage?

Correct AnswerverifiedShow Answer

Suppose XYZ Corporation is currently renting 300 units of capital at a rental price of $500 units per unit. The value of the marginal product of the 300th unit of capital is $400. How can the corporation increase its profit?

Correct AnswerverifiedIn view of the fact that the V...View AnswerShow Answer

Labor-augmenting technological advances decrease the marginal productivity of labor.

Correct AnswerverifiedShow Answer

Table 18-1 -Refer to Table 18-1. Suppose that the firm pays its workers $80 per day. Each unit of output sells for $15. How many days of labor should the firm hire?

Correct AnswerverifiedShow Answer

If the price of Verizon cell phones falls, what will happen to the demand curve for Verizon sales people?

Correct AnswerverifiedShow Answer

If the wages of a dentist increase,

Correct AnswerverifiedShow Answer

Harold owns a cranberry bog in which he grows cranberries. Harold's farm is a competitive, profit­maximizing firm. As such, Harold much decide (i) how many cranberries to sell. (ii) what price to charge for his cranberries. (iii) what wages to pay his workers. (iv) how many workers to hire.

Correct AnswerverifiedShow Answer

Which of the following events could increase the demand for labor?

Correct AnswerverifiedShow Answer

In a representative labor market,

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Fiona's hourly wage decreases from $10 to $8. Which of the following describes a consequence of the decrease in Fiona's wage?

Correct AnswerverifiedShow Answer

Competitive firms decide how much output to sell by producing output until the price of the good equals

Correct AnswerverifiedShow Answer

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value of t...
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In view of the fact that the V...
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Harold owns a cranberry bog in which he grows cranberries. Harold's farm is a competitive, profitmaximizing firm. As such, Harold much decide (i) how many cranberries to sell. (ii) what price to charge for his cranberries. (iii) what wages to pay his workers. (iv) how many workers to hire.

Correct Answer
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