Exam 10: Labor Markets and Income Distribution

Exhibit 10-7  Income distribution for three countries Exhibit 10-7 shows the percentage of income received by each population quintile. From this chart we can conclude:

Which of the following statements is true ?

A competitive car wash currently hires 4 workers, who together can wash 80 cars per day. The market price of car washes is $5 per wash, and the price of workers is $60 per day. The car wash should hire a fifth worker if it would increase total production to at least:

One reason the supply of carpenters is greater than the supply of physicians is because:

The optimal number of workers to be hired by a firm operating in a competitive labor market is where:

The official poverty rate for all persons declined sharply between 1959 and:

The marginal revenue product can be written as:

Which of the following most closely represents the share of total U.S. income to the poorest 20 percent of all U.S. families?

For a perfectly competitive firm, marginal revenue product is equal to:

In the United States, families headed by single women have higher poverty rates than families headed by single men or by married couples.

Wage discrimination means workers with equal productivity are paid unequal wages, or workers with unequal productivity are paid equal wages.

Describe the decision for a perfectly competitive employer in determining the profit maximizing quantity of labor to employ.

Critics of an equal distribution of income argue that the effect would be to raise the incentive to be productive.

In the United States since 1970, the poverty rate for blacks has been about:

The official U.S. poverty line for a family of four is calculated by taking 3 times the annual cost of:

The official poverty line is defined as:

Official figures indicate that the percentage of persons below the poverty level in the U.S. is more today than it was in 1959.

Exhibit 10-7  Income distribution for three countries Exhibit 10-7 shows the percentage of income received by each population quintile. In Country III, we can conclude that the:

Exhibit 10-3  Supply and demand curves for food servers In Exhibit 10-3, assume that both input and output markets are perfectly competitive. If one additional server increases the number of meals sold by four per day and each meal sells for $10, each additional food servers will be paid:

If the marginal product of labor is always positive, the total revenue will grow with each additional worker. Firms do not continuously hire new workers because: