Exam 19: Factor Markets and the Distribution of Income

One objection to the marginal productivity theory of income distribution is the existence of large disparities in income between factors of production that should receive the same payment.

A lumberjack cutting giant redwoods in California being paid more than is a person cutting and selling small Christmas trees is an example of wage disparity due primarily to compensating differentials.

A factor demand curve will shift because:

(Scenario: The Decision to Hire Labor)Use Scenario: The Decision to Hire Labor.This firm experiences diminishing marginal product after it hires the _____ worker. Scenario: The Decision to Hire Labor Assume that both the product market and the labor market are perfectly competitive.The price of this firm's product is $5.The firm's total product with respect to labor is given in the table that follows.

In 2015,fewer than 10% of the employees of private businesses were represented by unions.

The category "compensation of employees" doesn't capture the full income of labor because:

The _____ effect of a _____ wage causes individuals to substitute _____.

A nurse willing to work the midnight to 8 A.M.shift may make more than one who works 8 A.M.to 4 P.M.because of:

Which statement is TRUE?

A new teacher often makes less than a teacher with 20 years' experience because of:

Suppose that Billy Bud's Bucking Broncos employs 20 workers at a daily wage of $60 each.The average product of labor is 30 bucking broncos per day;the marginal product of the last worker is 12 bucking broncos per day;and total fixed cost is $3,600 for equipment.What is the marginal cost of the last bucking bronco produced?

Market forces tend to work against discrimination.

An input differs from a factor of production in that the former gets used up in production,while the latter is an enduring source of income for its owner.

At Hamill Manufacturing of Pennsylvania,highly skilled senior machinists are paid $70,000,excluding benefits,but the average skilled machinist generates approximately $137,000 in value added.This difference means that the marginal productivity theory of income distribution doesn't hold.

Within the labor-leisure framework,when an individual's income effect is stronger than the substitution effect from a wage increase,it means they have a(n):

Use the following to answer question: -(Table: Value of the Marginal Product of Labor and Demand)Use Table: Value of the Marginal Product of Labor and Demand.In the table,the total product of labor is shown for the hourly production of power cords.Assume that the market for power cords is perfectly competitive.The price of a power cord is $2,the market wage rate is $40 per hour,and 4 workers are hired.Profit can be maximized by hiring _____ worker(s).

Use the following to answer question: Figure: The Demand for Bricklayers -(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.The equilibrium market wage for bricklayers is $100.For a profit-maximizing firm at the equilibrium level of output,the VMPL_bricklayers:

Use the following to answer question: -(Table: Value of the Marginal Product of Labor and Demand)Use Table: Value of the Marginal Product of Labor and Demand.In the table,the total product of labor is shown for the hourly production of power cords.Assume that the market for power cords is perfectly competitive.If the price of a power cord is $2 and the wage rate is $90 per hour,the profit-maximizing quantity of labor is _____ workers.

Alex's boss notices that,with each adult education course Alex takes,he becomes a more knowledgeable and efficient worker.This example illustrates:

Suppose that the factor market for computer engineers is competitive in India and the United States,but Indian engineers earn one-fifth of what American engineers earn.This means that engineers in India are price takers,but engineers in America are not.