Question 1

The demand for a nonrenewable resource is

Accepted Answer

A)  determined by the value of its marginal product. 
B)  fixed and cannot change. 
C)  perfectly inelastic. 
D)  perfectly elastic. 
E)  not defined because the resource can be used only once. 
A)  determined by the value of its marginal product. 
B)  fixed and cannot change. 
C)  perfectly inelastic. 
D)  perfectly elastic. 
E)  not defined because the resource can be used only once.

Question 2

Which of the following statements about the supply of labor is correct?

Accepted Answer

A)  It is perfectly inelastic at whatever quantity individuals are willing to work. 
B)  An individual's supply of labor curve is always upward sloping, like the supply curves of other items. 
C)  It is perfectly price elastic at the current wage rate. 
D)  An individual's supply of labor curve can bend backwards. 
E)  The supply of labor curve is shaped like an upside-down U. 
A)  It is perfectly inelastic at whatever quantity individuals are willing to work. 
B)  An individual's supply of labor curve is always upward sloping, like the supply curves of other items. 
C)  It is perfectly price elastic at the current wage rate. 
D)  An individual's supply of labor curve can bend backwards. 
E)  The supply of labor curve is shaped like an upside-down U.

Question 3

-The figure above shows the market supply of labor curve.Which of the following might be the reason the labor supply curve shifted from S₀ to S₁?

Accepted Answer

A)  an increase in technology 
B)  a decrease in technology 
C)  an increase in the number of women in the work force 
D)  a decrease in the adult population 
E)  an increase in the wage rate 
A)  an increase in technology 
B)  a decrease in technology 
C)  an increase in the number of women in the work force 
D)  a decrease in the adult population 
E)  an increase in the wage rate

Question 4

-The above figure shows the initial demand for labor curve at a Pizza Hut in Canada.The wage rate is $6 an hour.If the demand for pizzas increases so that the price of a pizza rises,

Accepted Answer

A)  at the wage rate of $6 per hour, Pizza Hut hires fewer than 10 workers. 
B)  Pizza Hut's demand for labor curve shifts rightward. 
C)  the supply of labor curve shifts rightward. 
D)  Pizza Hut's demand for labor curve shifts leftward. 
E)  the supply of labor curve shifts leftward. 
A)  at the wage rate of $6 per hour, Pizza Hut hires fewer than 10 workers. 
B)  Pizza Hut's demand for labor curve shifts rightward. 
C)  the supply of labor curve shifts rightward. 
D)  Pizza Hut's demand for labor curve shifts leftward. 
E)  the supply of labor curve shifts leftward.

Question 5

The proposition that the price of a resource is expected to rise at a rate equal to the interest rate is called the

Accepted Answer

A)  Discounted Value Proposition. 
B)  derived demand for productive resources. 
C)  diminishing marginal revenue product. 
D)  Interest Rate Theory. 
E)  Hotelling Principle. 
A)  Discounted Value Proposition. 
B)  derived demand for productive resources. 
C)  diminishing marginal revenue product. 
D)  Interest Rate Theory. 
E)  Hotelling Principle.

Question 6

The demand for labor is derived from the

Accepted Answer

A)  supply of labor. 
B)  wage rate. 
C)  supply of the good the labor is used to produce. 
D)  demand for the goods and services the labor helps produce. 
E)  supply of all the other factors of production that can be substituted for labor. 
A)  supply of labor. 
B)  wage rate. 
C)  supply of the good the labor is used to produce. 
D)  demand for the goods and services the labor helps produce. 
E)  supply of all the other factors of production that can be substituted for labor.

Question 7

In order to spend more time with her children,a young mother decides to work fewer hours as her pay increases.What does her labor supply curve look like?

Accepted Answer

The young mother's labor supply curve is

Question 8

The figure above shows a labor market in which a union has formed.
-Labor unions' support for import restrictions represents an attempt to shift the

Accepted Answer

A)  labor demand curve from LD₀ to LD₁. 
B)  labor demand curve from LD₁ to LD₀. 
C)  labor supply curve from LS₀ to LS₁. 
D)  labor supply curve from LS₁ to LS₀. 
E)  None of the above answers is correct. 
A)  labor demand curve from LD₀ to LD₁. 
B)  labor demand curve from LD₁ to LD₀. 
C)  labor supply curve from LS₀ to LS₁. 
D)  labor supply curve from LS₁ to LS₀. 
E)  None of the above answers is correct.

Question 9

Explain why an individual's labor supply curve is backward bending.

Accepted Answer

An individual's labor supply curve bends

Question 10

Which of the following is a correct statement of the relationship between advances in technology and the demand for labor?

Accepted Answer

A)  The demand decreases for some types of labor and increases for other types of labor. 
B)  The demand for labor always decreases when technology advances. 
C)  The demand for labor always increases when technology advances. 
D)  Technology advances when the demand for labor advances. 
E)  None of the above answers is correct. 
A)  The demand decreases for some types of labor and increases for other types of labor. 
B)  The demand for labor always decreases when technology advances. 
C)  The demand for labor always increases when technology advances. 
D)  Technology advances when the demand for labor advances. 
E)  None of the above answers is correct.

Question 11

As a factor of production,any of the gifts of nature are called

Accepted Answer

A)  land. 
B)  labor. 
C)  capital. 
D)  entrepreneurial ability. 
E)  physical capital. 
A)  land. 
B)  labor. 
C)  capital. 
D)  entrepreneurial ability. 
E)  physical capital.

Question 12

The table has the marginal products for workers at Bart's Bats, a baseball bat factory.
-Using the above table,if the wage rate for a worker in a baseball bat manufacturing plant is $18 an hour,and the price of a bat is $3,then the firm will hire ________ workers.

Accepted Answer

A)  1 
B)  2 
C)  3 
D)  4 
E)  More information is needed to determine how many workers will be hired. 
A)  1 
B)  2 
C)  3 
D)  4 
E)  More information is needed to determine how many workers will be hired.

Question 13

If the price of capital rises,in the long run the demand for labor

Accepted Answer

A)  definitely increases. 
B)  definitely decreases. 
C)  definitely is unaffected. 
D)  could increase or decrease, depending on the change in the scale of production. 
E)  changes only if the supply of labor changes. 
A)  definitely increases. 
B)  definitely decreases. 
C)  definitely is unaffected. 
D)  could increase or decrease, depending on the change in the scale of production. 
E)  changes only if the supply of labor changes.

Question 14

If a union restricts the supply of labor,it ________ the wage rate and ________ the level of employment.

Accepted Answer

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

Question 15

As the population of Las Vegas increased,what happened to the supply of labor and the supply curve of labor in Las Vegas?

Accepted Answer

As the population of Las Vegas

Question 16

If the demand for a good increases,the demand for the factors used to produce the good

Accepted Answer

A)  increases. 
B)  decreases. 
C)  stays the same. 
D)  could increase, decrease, or stay the same depending on whether the demand for the good is elastic, inelastic, or unit elastic. 
E)  None of the above answers is correct. 
A)  increases. 
B)  decreases. 
C)  stays the same. 
D)  could increase, decrease, or stay the same depending on whether the demand for the good is elastic, inelastic, or unit elastic. 
E)  None of the above answers is correct.

Question 17

-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 four trainers,the value of marginal product of the fourth trainer equals

Accepted Answer

A)  10 clients. 
B)  $410. 
C)  $41. 
D)  1 client. 
E)  $10.25. 
A)  10 clients. 
B)  $410. 
C)  $41. 
D)  1 client. 
E)  $10.25.

Question 18

"In order for Charlie Trotter's,an upscale restaurant in Chicago,to maximize profit from the employment of chefs,the restaurant should hire chefs up to the point where the value of marginal product of chefs equals the wage rate for chefs." Is the statement correct or incorrect?

Accepted Answer

The statement is correct.In or

Question 19

Over time,the actual (not expected)price of a nonrenewable natural resource

Accepted Answer

A)  falls. 
B)  rises. 
C)  stays the same. 
D)  could rise, fall, or stay the same. 
E)  first rises and then falls. 
A)  falls. 
B)  rises. 
C)  stays the same. 
D)  could rise, fall, or stay the same. 
E)  first rises and then falls.

Question 20

If a firm finds itself at the point where the value of marginal product of labor is greater than its wage rate,then the firm

Accepted Answer

A)  stops hiring more workers but does not fire any because the firm is maximizing its profit. 
B)  decreases the number of workers it has hired in order to increase its profit. 
C)  increases the number of workers it hires in order to increase its profit. 
D)  increases sales to keep its employees busy. 
E)  changes its employment of workers and maximizes its profit by hiring the number of workers that makes the difference between the value of the marginal product and the wage rate as large as possible. 
A)  stops hiring more workers but does not fire any because the firm is maximizing its profit. 
B)  decreases the number of workers it has hired in order to increase its profit. 
C)  increases the number of workers it hires in order to increase its profit. 
D)  increases sales to keep its employees busy. 
E)  changes its employment of workers and maximizes its profit by hiring the number of workers that makes the difference between the value of the marginal product and the wage rate as large as possible.

The demand for a nonrenewable resource is

Which of the following statements about the supply of labor is correct?

-The figure above shows the market supply of labor curve.Which of the following might be the reason the labor supply curve shifted from S₀ to S₁?

-The above figure shows the initial demand for labor curve at a Pizza Hut in Canada.The wage rate is $6 an hour.If the demand for pizzas increases so that the price of a pizza rises,

The proposition that the price of a resource is expected to rise at a rate equal to the interest rate is called the

The demand for labor is derived from the

In order to spend more time with her children,a young mother decides to work fewer hours as her pay increases.What does her labor supply curve look like?

The figure above shows a labor market in which a union has formed. -Labor unions' support for import restrictions represents an attempt to shift the

Explain why an individual's labor supply curve is backward bending.

Which of the following is a correct statement of the relationship between advances in technology and the demand for labor?

As a factor of production,any of the gifts of nature are called

The table has the marginal products for workers at Bart's Bats, a baseball bat factory. -Using the above table,if the wage rate for a worker in a baseball bat manufacturing plant is $18 an hour,and the price of a bat is $3,then the firm will hire ________ workers.

If the price of capital rises,in the long run the demand for labor

If a union restricts the supply of labor,it the wage rate and the level of employment.

As the population of Las Vegas increased,what happened to the supply of labor and the supply curve of labor in Las Vegas?

If the demand for a good increases,the demand for the factors used to produce the good

-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 four trainers,the value of marginal product of the fourth trainer equals

"In order for Charlie Trotter's,an upscale restaurant in Chicago,to maximize profit from the employment of chefs,the restaurant should hire chefs up to the point where the value of marginal product of chefs equals the wage rate for chefs." Is the statement correct or incorrect?

Over time,the actual (not expected)price of a nonrenewable natural resource

If a firm finds itself at the point where the value of marginal product of labor is greater than its wage rate,then the firm

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 demand for a nonrenewable resource is

Which of the following statements about the supply of labor is correct?

-The figure above shows the market supply of labor curve.Which of the following might be the reason the labor supply curve shifted from S₀ to S₁?

-The above figure shows the initial demand for labor curve at a Pizza Hut in Canada.The wage rate is $6 an hour.If the demand for pizzas increases so that the price of a pizza rises,

The proposition that the price of a resource is expected to rise at a rate equal to the interest rate is called the

The demand for labor is derived from the

In order to spend more time with her children,a young mother decides to work fewer hours as her pay increases.What does her labor supply curve look like?

The figure above shows a labor market in which a union has formed. -Labor unions' support for import restrictions represents an attempt to shift the

Explain why an individual's labor supply curve is backward bending.

Which of the following is a correct statement of the relationship between advances in technology and the demand for labor?

As a factor of production,any of the gifts of nature are called

The table has the marginal products for workers at Bart's Bats, a baseball bat factory. -Using the above table,if the wage rate for a worker in a baseball bat manufacturing plant is $18 an hour,and the price of a bat is $3,then the firm will hire ________ workers.

If the price of capital rises,in the long run the demand for labor

If a union restricts the supply of labor,it ________ the wage rate and ________ the level of employment.

As the population of Las Vegas increased,what happened to the supply of labor and the supply curve of labor in Las Vegas?

If the demand for a good increases,the demand for the factors used to produce the good

-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 four trainers,the value of marginal product of the fourth trainer equals

"In order for Charlie Trotter's,an upscale restaurant in Chicago,to maximize profit from the employment of chefs,the restaurant should hire chefs up to the point where the value of marginal product of chefs equals the wage rate for chefs." Is the statement correct or incorrect?

Over time,the actual (not expected)price of a nonrenewable natural resource

If a firm finds itself at the point where the value of marginal product of labor is greater than its wage rate,then the firm

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

If a union restricts the supply of labor,it the wage rate and the level of employment.