Question 1

The supply of nonrenewable natural resources is

Accepted Answer

A)  perfectly inelastic. 
B)  perfectly elastic. 
C)  always elastic but not necessarily perfectly elastic. 
D)  inelastic at high prices and elastic at low prices. 
E)  elastic at high prices and inelastic at low prices. 
A)  perfectly inelastic. 
B)  perfectly elastic. 
C)  always elastic but not necessarily perfectly elastic. 
D)  inelastic at high prices and elastic at low prices. 
E)  elastic at high prices and inelastic at low prices.

Question 2

-Kevin owns a personal training gym in Laredo,Texas.He charges $41 per session.The above table shows the marginal product of trainers in Kevin's gym.If Kevin hires three trainers,the value of marginal product of the third trainer equals

Accepted Answer

A)  2 clients. 
B)  $82. 
C)  9 clients. 
D)  $369. 
E)  $123. 
A)  2 clients. 
B)  $82. 
C)  9 clients. 
D)  $369. 
E)  $123.

Question 3

The figure above shows a firm's VMP curve.
-Suppose that new technology raises the workers' marginal product.As a result,

Accepted Answer

A)  there is a movement upward along the curve, such as a movement from point C to point B. 
B)  there is a movement downward along the curve, such as a movement from point C to point D. 
C)  the curve shifts rightward. 
D)  the curve shifts leftward. 
E)  More information is needed to answer the question. 
A)  there is a movement upward along the curve, such as a movement from point C to point B. 
B)  there is a movement downward along the curve, such as a movement from point C to point D. 
C)  the curve shifts rightward. 
D)  the curve shifts leftward. 
E)  More information is needed to answer the question.

Question 4

As the price of land rises,the quantity supplied

Accepted Answer

A)  increases. 
B)  decreases. 
C)  at first increases and then decreases. 
D)  stays the same. 
E)  at first decreases and then increases. 
A)  increases. 
B)  decreases. 
C)  at first increases and then decreases. 
D)  stays the same. 
E)  at first decreases and then increases.

Question 5

A worker has a marginal product of 15 units a day,each of which can be sold for $10.Is it profitable to hire this worker if the wage rate is $100 a day? Briefly explain your answer.

Accepted Answer

It is profitable to hire this worker bec

Question 6

The wage paid to labor is

Accepted Answer

A)  a factor output. 
B)  a factor price. 
C)  a factor input. 
D)  an input of the workforce. 
E)  part of the firm's normal profit. 
A)  a factor output. 
B)  a factor price. 
C)  a factor input. 
D)  an input of the workforce. 
E)  part of the firm's normal profit.

Question 7

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)  an increase in union members' productivity 
D)  new laws that restrict immigration 
E)  All of the above would decrease the supply of labor. 
A)  an increase in the minimum wage 
B)  an increase in the demand for imported goods 
C)  an increase in union members' productivity 
D)  new laws that restrict immigration 
E)  All of the above would decrease the supply of labor.

Question 8

An increase in the rental rate of capital ________ the quantity of capital demanded and ________ the quantity of capital supplied.

Accepted Answer

A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases 
E)  does not change; does not change 
A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases 
E)  does not change; does not change

Question 9

-The above figure represents the market for teenage workers at fast-food restaurants in Kansas City.
a.What is the equilibrium wage rate and employment?
b.Describe the market at a wage rate of $6 per hour.
c.Describe the market at a wage rate of $12 an hour.
d.How would an increase in the number of young,married college graduates,who tend to eat at fast-food restaurants,affect the figure,the equilibrium wage rate,and employment?

Accepted Answer

a.The equilibrium wage rate is $8 an hou

Question 10

A producer's supply of a nonrenewable natural resource is

Accepted Answer

A)  always decreasing because the resource is always being used. 
B)  perfectly inelastic. 
C)  perfectly elastic. 
D)  not relevant because nonrenewable resources are used only once. 
E)  is determined by the value of the resource's marginal product. 
A)  always decreasing because the resource is always being used. 
B)  perfectly inelastic. 
C)  perfectly elastic. 
D)  not relevant because nonrenewable resources are used only once. 
E)  is determined by the value of the resource's marginal product.

Question 11

The price of an nonrenewable resource is expected to rise at a rate equal to the

Accepted Answer

A)  rate of supply. 
B)  rate of population growth. 
C)  rate of technological change. 
D)  rate of demand. 
E)  interest rate. 
A)  rate of supply. 
B)  rate of population growth. 
C)  rate of technological change. 
D)  rate of demand. 
E)  interest rate.

Question 12

If the price of a firm's product falls,the firm's demand for labor curve

Accepted Answer

A)  does not shift and there is no movement along it. 
B)  shifts leftward. 
C)  shifts rightward. 
D)  does not shift but there is a movement along it. 
E)  might shift leftward or rightward depending on whether the demand for the firm's product is elastic or inelastic. 
A)  does not shift and there is no movement along it. 
B)  shifts leftward. 
C)  shifts rightward. 
D)  does not shift but there is a movement along it. 
E)  might shift leftward or rightward depending on whether the demand for the firm's product is elastic or inelastic.

Question 13

Why do baseball players make so much money,while kindergarten teachers in private schools make so much less? In your answer,discuss the value of marginal product and the actions of profit-maximizing firms.

Accepted Answer

Let us consider the value of the margina

Question 14

Which of the following is true?

Accepted Answer

A)  The value to a firm of hiring another worker is the worker's value of marginal product. 
B)  A firm will hire more workers if the wage rate is greater than the value of marginal product. 
C)  The value of marginal product is the cost of hiring a worker. 
D)  The value of marginal product increases as more workers are hired. 
E)  The value of marginal product equals the price of the good produced divided by the marginal product. 
A)  The value to a firm of hiring another worker is the worker's value of marginal product. 
B)  A firm will hire more workers if the wage rate is greater than the value of marginal product. 
C)  The value of marginal product is the cost of hiring a worker. 
D)  The value of marginal product increases as more workers are hired. 
E)  The value of marginal product equals the price of the good produced divided by the marginal product.

Question 15

The demand curve for a factor of production is

Accepted Answer

A)  the same as the factor's supply curve. 
B)  upward sloping. 
C)  the same as the factor's value of marginal product curve. 
D)  vertical. 
E)  None of the above answers is correct. 
A)  the same as the factor's supply curve. 
B)  upward sloping. 
C)  the same as the factor's value of marginal product curve. 
D)  vertical. 
E)  None of the above answers is correct.

Question 16

The rule for maximizing profit is to hire labor up to the point at which the value of marginal product

Accepted Answer

A)  equals the wage rate. 
B)  is greater than the wage rate. 
C)  is less than the wage rate. 
D)  is a mirror image of the wage rate. 
E)  equals the price of the product produced. 
A)  equals the wage rate. 
B)  is greater than the wage rate. 
C)  is less than the wage rate. 
D)  is a mirror image of the wage rate. 
E)  equals the price of the product produced.

Question 17

The demand for a factor of production is called a derived demand because it is derived from

Accepted Answer

A)  the demand for goods and services produced by the factor of production. 
B)  a table of specific prices and quantities. 
C)  the ideas of an entrepreneur. 
D)  a financial market. 
E)  the supply of the factor of production. 
A)  the demand for goods and services produced by the factor of production. 
B)  a table of specific prices and quantities. 
C)  the ideas of an entrepreneur. 
D)  a financial market. 
E)  the supply of the factor of production.

Question 18

In the market for land,the supply curve is

Accepted Answer

A)  upward sloping. 
B)  downward sloping. 
C)  horizontal. 
D)  vertical. 
E)  U-shaped. 
A)  upward sloping. 
B)  downward sloping. 
C)  horizontal. 
D)  vertical. 
E)  U-shaped.

Question 19

The demand for carpenters needed to build houses represents a

Accepted Answer

A)  direct demand. 
B)  derived demand. 
C)  marginal demand/cost for input. 
D)  supplied demand. 
E)  directed supply. 
A)  direct demand. 
B)  derived demand. 
C)  marginal demand/cost for input. 
D)  supplied demand. 
E)  directed supply.

Question 20

Suppose Mongo runs a glue factory in Knuckle,North Dakota.Mongo wants to fire his cousin Beevo for not working very hard at making glue.If firing Beevo would save Mongo $6.11 per hour in wages and the value of Beevo's marginal product equals $7.29 per hour,to maximize his profit,Mongo should

Accepted Answer

A)  fire Beevo. 
B)  keep Beevo employed. 
C)  add another worker, Teevo, Beevo's sister, whose value of the marginal product would be $4.83 per hour and whose wage would be $6.11 per hour. 
D)  increase the wage he pays Beevo to $7.29 per hour. 
E)  There is not enough information given to determine what Mongo should do. 
A)  fire Beevo. 
B)  keep Beevo employed. 
C)  add another worker, Teevo, Beevo's sister, whose value of the marginal product would be $4.83 per hour and whose wage would be $6.11 per hour. 
D)  increase the wage he pays Beevo to $7.29 per hour. 
E)  There is not enough information given to determine what Mongo should do.

The supply of nonrenewable natural resources is

-Kevin owns a personal training gym in Laredo,Texas.He charges $41 per session.The above table shows the marginal product of trainers in Kevin's gym.If Kevin hires three trainers,the value of marginal product of the third trainer equals

The figure above shows a firm's VMP curve. -Suppose that new technology raises the workers' marginal product.As a result,

As the price of land rises,the quantity supplied

A worker has a marginal product of 15 units a day,each of which can be sold for $10.Is it profitable to hire this worker if the wage rate is $100 a day? Briefly explain your answer.

The wage paid to labor is

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

An increase in the rental rate of capital the quantity of capital demanded and the quantity of capital supplied.

A producer's supply of a nonrenewable natural resource is

The price of an nonrenewable resource is expected to rise at a rate equal to the

If the price of a firm's product falls,the firm's demand for labor curve

Why do baseball players make so much money,while kindergarten teachers in private schools make so much less? In your answer,discuss the value of marginal product and the actions of profit-maximizing firms.

Which of the following is true?

The demand curve for a factor of production is

The rule for maximizing profit is to hire labor up to the point at which the value of marginal product

The demand for a factor of production is called a derived demand because it is derived from

In the market for land,the supply curve is

The demand for carpenters needed to build houses represents a

Suppose Mongo runs a glue factory in Knuckle,North Dakota.Mongo wants to fire his cousin Beevo for not working very hard at making glue.If firing Beevo would save Mongo $6.11 per hour in wages and the value of Beevo's marginal product equals $7.29 per hour,to maximize his profit,Mongo should

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Economic Inequality

Filters

Exam 19: Markets for Factors of Production

The supply of nonrenewable natural resources is

-Kevin owns a personal training gym in Laredo,Texas.He charges $41 per session.The above table shows the marginal product of trainers in Kevin's gym.If Kevin hires three trainers,the value of marginal product of the third trainer equals

The figure above shows a firm's VMP curve. -Suppose that new technology raises the workers' marginal product.As a result,

As the price of land rises,the quantity supplied

A worker has a marginal product of 15 units a day,each of which can be sold for $10.Is it profitable to hire this worker if the wage rate is $100 a day? Briefly explain your answer.

The wage paid to labor is

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

An increase in the rental rate of capital ________ the quantity of capital demanded and ________ the quantity of capital supplied.

A producer's supply of a nonrenewable natural resource is

The price of an nonrenewable resource is expected to rise at a rate equal to the

If the price of a firm's product falls,the firm's demand for labor curve

Why do baseball players make so much money,while kindergarten teachers in private schools make so much less? In your answer,discuss the value of marginal product and the actions of profit-maximizing firms.

Which of the following is true?

The demand curve for a factor of production is

The rule for maximizing profit is to hire labor up to the point at which the value of marginal product

The demand for a factor of production is called a derived demand because it is derived from

In the market for land,the supply curve is

The demand for carpenters needed to build houses represents a

Suppose Mongo runs a glue factory in Knuckle,North Dakota.Mongo wants to fire his cousin Beevo for not working very hard at making glue.If firing Beevo would save Mongo $6.11 per hour in wages and the value of Beevo's marginal product equals $7.29 per hour,to maximize his profit,Mongo should

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets With Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Economic Inequality

Filters

An increase in the rental rate of capital the quantity of capital demanded and the quantity of capital supplied.