Question 1

Which of the following best describes the economy's stock of equipment and structures?

Accepted Answer

A)   capital
B)   aggregate demand
C)   long-term inventory
D)   aggregate stockE) A) and D)
F) All of the above

Question 2

Which of the following could increase the supply of labor in the market for cranberry pickers?

Accepted Answer

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

Question 3

Scenario 18-2
Gertrude Kelp owns three boats that participate in commercial fishing for fresh Pacific salmon off the coast of Alaska. As part of her business she hires a captain and several crew members for each boat. In the market for fresh Pacific salmon, there are thousands of firms like Gertrude's. While Gertrude usually catches a significant number of fish each year, her contribution to the entire harvest of salmon is negligible relative to the size of the market.
-Refer to Scenario 18-2. If the price of fresh Pacific salmon were to decrease significantly, it is most likely that Gertrude would

Accepted Answer

A)   reduce her demand for crew members.
B)   hire more boats.
C)   become a seller in at least one factor market.
D)   hire more crew members.E) A) and D)
F) A) and C)

Question 4

Table 18-9
The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. 
-Refer to Table 18-9. What is the marginal product of the fourth unit of labor?

Accepted Answer

A)   40 units
B)   50 units
C)   60 units
D)   180 unitsE) All of the above
F) A) and C)

Question 5

The value of the marginal product of labor is equal to the change in

Accepted Answer

A)   marginal cost caused by the addition of the last worker.
B)   total cost caused by the addition of the last worker.
C)   total revenue caused by the addition of the last worker.
D)   total profit caused by the addition of the last worker.E) C) and D)
F) None of the above

Question 6

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is

Accepted Answer

A)   vertical.
B)   horizontal.
C)   upward sloping.
D)   backward sloping.E) B) and C)
F) A) and B)

Question 7

Figure 18-1
On the graph, L represents the quantity of labor and Q represents the quantity of output per week. 
-Refer to Figure 18-1. Suppose the firm sells its output for $12 per unit, and it pays each of its workers $700 per week. How many workers will the firm hire to maximize its profit?

Accepted Answer

A)   2
B)   3
C)   4
D)   5E) None of the above
F) C) and D)

Question 8

In order to study labor markets more easily, we make which of the following assumptions about firms?

Accepted Answer

A)   (iii)  only
B)   (i)  and (iii)  only
C)   (i) , (ii) , and (iii)  only
D)   (i) , (ii) , (iii) , and (iv) E) A) and B)
F) All of the above

Question 9

Figure 18-8
This figure below shows the labor market for automobile workers. The curve labeled S is the labor supply curve, and the curves labeled D1 and D2 are the labor demand curves. On the horizontal axis, L represents the quantity of labor in the market. 1 and D2 are the labor demand curves. On the horizontal axis, L represents the quantity of labor in the market.   -Refer to Figure 18-8. Which of the following events would most likely explain the shift of the labor-demand curve from D1 to D2? A)  The price of automobiles decreased. B)  A large number of immigrants entered the automobile-worker market. C)  A technological advance increased the marginal product of automobile workers. D)  All of the above are correct." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 18-8. Which of the following events would most likely explain the shift of the labor-demand curve from D1 to D2?

Accepted Answer

A)   The price of automobiles decreased.
B)   A large number of immigrants entered the automobile-worker market.
C)   A technological advance increased the marginal product of automobile workers.
D)   All of the above are correct.E) A) and C)
F) B) and C)

Question 10

Table 18-10 
-Refer to Table 18-10. This table describes the number of baseballs a manufacturer can produce per day with different quantities of labor. Each baseball sells for $5 in a competitive market. What is the marginal revenue product of the third worker?

Accepted Answer

A)   120 baseballs.
B)   $300
C)   $400
D)   $600E) A) and B)
F) A) and D)

Question 11

A firm's demand for labor is derived from its decision to supply a good in another market.

Accepted Answer

A) True 
 B)False

Question 12

The idea that rational employers think at the margin is central to understanding how many units of labor they choose to employ.

Accepted Answer

A) True 
 B)False

Question 13

If men's preferences for work change such that more men want to be stay­at­home fathers, the wages paid to men who remain in the workplace would rise, all else equal.

Accepted Answer

A) True 
 B)False

Question 14

Diminishing marginal product is closely related to

Accepted Answer

A)   diminishing total cost.
B)   diminishing marginal cost.
C)   increasing price.
D)   increasing marginal cost.E) A) and B)
F) None of the above

Question 15

Suppose that an industrial accident at a factory destroys a significant number of high-speed blenders that bartenders use to mix frozen drinks. What will happen in the labor market for bartenders?

Accepted Answer

A)   Both wages and employment will increase.
B)   Both wages and employment will decrease.
C)   Wages will increase, and employment will decrease.
D)   Wages will decrease, and employment will increase.E) B) and C)
F) A) and C)

Question 16

To say that a firm is competitive in the labor market is to say that the firm

Accepted Answer

A)   has little or no control over the number of workers it hires.
B)   has little or no control over the wage it pays its workers.
C)   is aggressive in pursuing the most skilled workers in the labor market.
D)   is aggressive in trying to keep its workers' wages low.E) A) and B)
F) A) and C)

Question 17

Figure 18-12. The figure shows the relationship between the number of mechanics hired and the number of car repairs performed per day at a car-repair shop. 
-Refer to Figure 18-12. If the shop charges $150 per repair and pays each of its mechanics a wage of $700 per day, then what is the marginal profit of the second mechanic?

Accepted Answer

The marginal product of the second mecha...

Question 18

Juanita is trying to convince the owner of a jewelry store to hire her. She argues that she could help the shop sell an additional three rings per day for a profit of $20 each. If the facts are not in dispute, but the owner does not hire her, then

Accepted Answer

A)   the wage rate must be less than $60 per day.
B)   hiring Juanita would involve a negative marginal product.
C)   the wage rate must be more than $60 per day.
D)   the wage rate must be less than $20 per day.E) A) and B)
F) B) and D)

Question 19

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) All of the above
F) B) and C)

Question 20

Which of the following qualify as part of our economy's capital income?

Accepted Answer

A)   wages paid to workers
B)   interest paid to the owners of corporate bonds
C)   rent paid on farmland
D)   All of the above are correct.E) All of the above
F) C) and D)

Exam 18: The Markets for the Factors of Production

Table 18-9 The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. -Refer to Table 18-9. What is the marginal product of the fourth unit of labor?

Correct Answer
verified

In order to study labor markets more easily, we make which of the following assumptions about firms?

Correct Answer
verified

Which of the following qualify as part of our economy's capital income?

Correct Answer
verified

Correct Answer
verified
The marginal product of the second mecha...
View Answer

Figure 18-1 On the graph, L represents the quantity of labor and Q represents the quantity of output per week. -Refer to Figure 18-1. Suppose the firm sells its output for $12 per unit, and it pays each of its workers $700 per week. How many workers will the firm hire to maximize its profit?

Correct Answer
verified

To say that a firm is competitive in the labor market is to say that the firm

Correct Answer
verified

Correct Answer
verified

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is

Correct Answer
verified

Which of the following could increase the supply of labor in the market for cranberry pickers?

Correct Answer
verified

The idea that rational employers think at the margin is central to understanding how many units of labor they choose to employ.

Correct Answer
verified

Which of the following best describes the economy's stock of equipment and structures?

Correct Answer
verified

A firm's demand for labor is derived from its decision to supply a good in another market.

Correct Answer
verified

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
verified

Correct Answer
verified

Suppose that an industrial accident at a factory destroys a significant number of high-speed blenders that bartenders use to mix frozen drinks. What will happen in the labor market for bartenders?

Correct Answer
verified

Diminishing marginal product is closely related to

Correct Answer
verified

The value of the marginal product of labor is equal to the change in

Correct Answer
verified

If men's preferences for work change such that more men want to be stayathome fathers, the wages paid to men who remain in the workplace would rise, all else equal.

Correct Answer
verified

Juanita is trying to convince the owner of a jewelry store to hire her. She argues that she could help the shop sell an additional three rings per day for a profit of $20 each. If the facts are not in dispute, but the owner does not hire her, then

Correct Answer
verified

Table 18-10 -Refer to Table 18-10. This table describes the number of baseballs a manufacturer can produce per day with different quantities of labor. Each baseball sells for $5 in a competitive market. What is the marginal revenue product of the third worker?

Correct Answer
verified

Exam 18: The Markets for the Factors of Production

Table 18-9 The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. -Refer to Table 18-9. What is the marginal product of the fourth unit of labor?

Correct AnswerverifiedShow Answer

In order to study labor markets more easily, we make which of the following assumptions about firms?

Correct AnswerverifiedShow Answer

Which of the following qualify as part of our economy's capital income?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe marginal product of the second mecha...View AnswerShow Answer

Figure 18-1 On the graph, L represents the quantity of labor and Q represents the quantity of output per week. -Refer to Figure 18-1. Suppose the firm sells its output for $12 per unit, and it pays each of its workers $700 per week. How many workers will the firm hire to maximize its profit?

Correct AnswerverifiedShow Answer

To say that a firm is competitive in the labor market is to say that the firm

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is

Correct AnswerverifiedShow Answer

Which of the following could increase the supply of labor in the market for cranberry pickers?

Correct AnswerverifiedShow Answer

The idea that rational employers think at the margin is central to understanding how many units of labor they choose to employ.

Correct AnswerverifiedShow Answer

Which of the following best describes the economy's stock of equipment and structures?

Correct AnswerverifiedShow Answer

A firm's demand for labor is derived from its decision to supply a good in another market.

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

Correct AnswerverifiedShow Answer

Suppose that an industrial accident at a factory destroys a significant number of high-speed blenders that bartenders use to mix frozen drinks. What will happen in the labor market for bartenders?

Correct AnswerverifiedShow Answer

Diminishing marginal product is closely related to

Correct AnswerverifiedShow Answer

The value of the marginal product of labor is equal to the change in

Correct AnswerverifiedShow Answer

If men's preferences for work change such that more men want to be stay­at­home fathers, the wages paid to men who remain in the workplace would rise, all else equal.

Correct AnswerverifiedShow Answer

Juanita is trying to convince the owner of a jewelry store to hire her. She argues that she could help the shop sell an additional three rings per day for a profit of $20 each. If the facts are not in dispute, but the owner does not hire her, then

Correct AnswerverifiedShow Answer

Table 18-10 -Refer to Table 18-10. This table describes the number of baseballs a manufacturer can produce per day with different quantities of labor. Each baseball sells for $5 in a competitive market. What is the marginal revenue product of the third worker?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
The marginal product of the second mecha...
View Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

If men's preferences for work change such that more men want to be stayathome fathers, the wages paid to men who remain in the workplace would rise, all else equal.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified