Question 1

The wealthiest 10 percent of Canadian families own approximately

Accepted Answer

A) 10 percent of the wealth. 
B) 17 percent of the wealth. 
C) 56 percent of the wealth. 
D) 67 percent of the wealth. 
E) 80 percent of the wealth. 
A) 10 percent of the wealth. 
B) 17 percent of the wealth. 
C) 56 percent of the wealth. 
D) 67 percent of the wealth. 
E) 80 percent of the wealth.

Question 2

Suppose a profit-maximizing firm hires labour in a competitive labour market.If the value of marginal product of labour is greater than the wage rate, the firm should

Accepted Answer

A) increase the wage rate. 
B) decrease the wage rate. 
C) increase the quantity of labour it hires. 
D) decrease the quantity of labour it hires. 
E) shift to a more labour-intensive production process. 
A) increase the wage rate. 
B) decrease the wage rate. 
C) increase the quantity of labour it hires. 
D) decrease the quantity of labour it hires. 
E) shift to a more labour-intensive production process.

Question 3

The income effect of a higher wage is defined as

Accepted Answer

A) the increased income workers must be paid to be willing to work more. 
B) the increased prices of consumer goods that result from increased worker incomes. 
C) the increased demand for leisure that results from increased worker incomes. 
D) the increased workers' purchasing power that results from increased worker incomes. 
E) the desire for workers to purchase more normal goods and fewer inferior goods as income rises. 
A) the increased income workers must be paid to be willing to work more. 
B) the increased prices of consumer goods that result from increased worker incomes. 
C) the increased demand for leisure that results from increased worker incomes. 
D) the increased workers' purchasing power that results from increased worker incomes. 
E) the desire for workers to purchase more normal goods and fewer inferior goods as income rises.

Question 4

A technological change that increases the value of marginal product of labour shifts the labour

Accepted Answer

A) demand curve leftward. 
B) demand curve rightward. 
C) supply curve leftward. 
D) supply curve rightward. 
E) demand curve rightward and the labour supply curve rightward. 
A) demand curve leftward. 
B) demand curve rightward. 
C) supply curve leftward. 
D) supply curve rightward. 
E) demand curve rightward and the labour supply curve rightward.

Question 5

Use the information below to answer the following questions.
Fact 18.3.1 In Modern Rarity, Workers Form Union at Small Chain
In New York's low-income neighbourhoods, labour unions have virtually no presence. But after a year-long struggle, 95 workers at a chain of 10 sneaker stores have formed a union. After months of negotiations, the two sides signed a three-year contract that sets the wage rate at $7.25 an hour.
Source: The New York Times, February 5, 2006
-Refer to Fact 18.3.1.Labour unions are scarce in New York's low-income neighbourhoods because there are

Accepted Answer

A) a great number of low-skilled workers, which makes it more difficult for a union to organize and influence them. 
B) too few employers, which makes forming a labour union an inefficient use of time. 
C) many immigrants, who do not support unions. 
D) many workers who are satisfied to earn minimum wage, which they can do without help from a labour union. 
E) so many unemployed people who are thankful for a job regardless of the working conditions. 
A) a great number of low-skilled workers, which makes it more difficult for a union to organize and influence them. 
B) too few employers, which makes forming a labour union an inefficient use of time. 
C) many immigrants, who do not support unions. 
D) many workers who are satisfied to earn minimum wage, which they can do without help from a labour union. 
E) so many unemployed people who are thankful for a job regardless of the working conditions.

Question 6

Use the information below to answer the following questions.
Fact 18.2.1
Wanda's is a fish store that hires students to pack the fish. The fish market is competitive. Originally the price is 50¢ a kilogram. The market for packers is competitive and their market wage rate is $7.50 an hour. Then the market price of fish falls to 33.33¢ a kilogram but the wage rate of fish packers remains at $7.50 an hour.
-Refer to Fact 18.2.1.As a result, students' marginal product ________ and students' value of marginal product ________.

Accepted Answer

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

Question 7

New technology has allowed oil to be pumped from much deeper offshore oil fields than before.For example, 28 deep ocean rigs operate in the deep waters of the Gulf of Mexico.Deep ocean sources have ________ the world price of oil.Those who benefit from drilling for oil in the Gulf of Mexico are ________.

Accepted Answer

A) raised; both consumers and suppliers 
B) lowered; both consumers and suppliers 
C) raised; consumers only 
D) lowered; consumers only 
E) raised; consumers and the government 
A) raised; both consumers and suppliers 
B) lowered; both consumers and suppliers 
C) raised; consumers only 
D) lowered; consumers only 
E) raised; consumers and the government

Question 8

The value of marginal product of labour is the revenue

Accepted Answer

A) generated by selling an additional unit of output. 
B) needed to hire an additional unit of labour. 
C) generated by the employment of an additional unit of labour. 
D) needed to cover the cost of producing an additional unit of output. 
E) generated to cover the cost of hiring an extra unit of labour. 
A) generated by selling an additional unit of output. 
B) needed to hire an additional unit of labour. 
C) generated by the employment of an additional unit of labour. 
D) needed to cover the cost of producing an additional unit of output. 
E) generated to cover the cost of hiring an extra unit of labour.

Question 9

Table 18.3.1  
-Refer to Table 18.3.1.Table 18.3.1 gives information about the labour market in Lantis, a community in which the labour market is perfectly competitive.The equilibrium wage rate is ________ an hour and the quantity of labour employed is ________ hours per day.

Accepted Answer

A) $25; 600 
B) $25; 200 
C) $15; 400 
D) $5; 200 
E) $5; 600 
A) $25; 600 
B) $25; 200 
C) $15; 400 
D) $5; 200 
E) $5; 600

Question 10

Use the figure below to answer the following questions.
   
Figure 19.3.5
-Refer to Figure 19.3.5.This figure shows the labour supply curves and the value of marginal product curves for high-skilled and low-skilled workers.If there is an increase in the supply of high-skilled workers and the supply of high-skilled workers is now equal to the supply of low-skilled workers, then employment of high-skilled labour would

Accepted Answer

A) remain the same. 
B) decrease. 
C) increase to 40 hours per week. 
D) increase to 50 hours per week. 
E) none of the above 
A) remain the same. 
B) decrease. 
C) increase to 40 hours per week. 
D) increase to 50 hours per week. 
E) none of the above

Question 11

If the present value of $100 received one year from now is $80, what is the annual interest rate?

Accepted Answer

A) 8 percent 
B) 10 percent 
C) 20 percent 
D) 25 percent 
E) 50 percent 
A) 8 percent 
B) 10 percent 
C) 20 percent 
D) 25 percent 
E) 50 percent

Question 12

Use the figure below to answer the following questions.
   
Figure 19.1.3
-In Figure 19.1.3, the poorest 20 percent of all families receive what share of income?

Accepted Answer

A) 10 percent 
B) 20 percent 
C) 30 percent 
D) 40 percent 
E) 50 percent 
A) 10 percent 
B) 20 percent 
C) 30 percent 
D) 40 percent 
E) 50 percent

Question 13

Use the figure below to answer the following questions.
   
Figure 19.3.2
-Refer to Figure 19.3.2.At a wage rate of $5, an employer would hire

Accepted Answer

A) the same amount of high-skilled workers and low-skilled workers. 
B) 20 hours of low-skilled labour and 40 hours of high-skilled labour. 
C) 60 hours of low-skilled labour and 20 hours of high-skilled labour. 
D) 20 hours of low-skilled labour and 60 hours of high-skilled labour. 
E) 40 hours of low-skilled labour and 60 hours of high-skilled labour. 
A) the same amount of high-skilled workers and low-skilled workers. 
B) 20 hours of low-skilled labour and 40 hours of high-skilled labour. 
C) 60 hours of low-skilled labour and 20 hours of high-skilled labour. 
D) 20 hours of low-skilled labour and 60 hours of high-skilled labour. 
E) 40 hours of low-skilled labour and 60 hours of high-skilled labour.

Question 14

The four factors of production are

Accepted Answer

A) productive factors, neutral factors, entrepreneurial factors, and nonproductive factors. 
B) men, women, animals, and children. 
C) labour, capital, entrepreneurship, and land. 
D) machines, factories, buildings, and farms. 
E) labour, money, profits, and land. 
A) productive factors, neutral factors, entrepreneurial factors, and nonproductive factors. 
B) men, women, animals, and children. 
C) labour, capital, entrepreneurship, and land. 
D) machines, factories, buildings, and farms. 
E) labour, money, profits, and land.

Question 15

Assortative mating means that

Accepted Answer

A) poor men tend to marry rich women. 
B) people tend to marry within their own socioeconomic class. 
C) people tend to marry above their own socioeconomic class. 
D) same sex marriages occur because "like attracts like." 
E) people with different values will marry. 
A) poor men tend to marry rich women. 
B) people tend to marry within their own socioeconomic class. 
C) people tend to marry above their own socioeconomic class. 
D) same sex marriages occur because "like attracts like." 
E) people with different values will marry.

Question 16

Choose the statement that is incorrect.

Accepted Answer

A) Capital consists of the tools, instruments, machines, buildings, and other constructions that have been produced in the past and that businesses now use to produce goods and services. 
B) A market for capital services is a rental market. 
C) The services of the capital that a firm owns and operates have an implicit price that arises from depreciation and interest costs. 
D) Capital is a factor of production. 
E) Most capital services are traded in a market. 
A) Capital consists of the tools, instruments, machines, buildings, and other constructions that have been produced in the past and that businesses now use to produce goods and services. 
B) A market for capital services is a rental market. 
C) The services of the capital that a firm owns and operates have an implicit price that arises from depreciation and interest costs. 
D) Capital is a factor of production. 
E) Most capital services are traded in a market.

Question 17

Use the table below to answer the following questions.
Table 18.2.3
  
-Emperor Spring Rolls produces spring rolls.The market for spring rolls is perfectly competitive, and the price of a spring roll is $3.50.The labour market is competitive, and the wage rate is $28 a day.Table 18.2.3 shows the workers' total product schedule.To maximize its profit, Emperor hires ________ workers a day.

Accepted Answer

A) 2 
B) 3 
C) 4 
D) 5 
E) 6 
A) 2 
B) 3 
C) 4 
D) 5 
E) 6

Question 18

The demand curve for labour will shift rightward as a result of

Accepted Answer

A) a decrease in the price of the firm's output. 
B) an increase in the wage rate. 
C) a decrease in the price of a substitute factor of production. 
D) an increase in the price of a substitute factor of production. 
E) a decrease in the wage rate. 
A) a decrease in the price of the firm's output. 
B) an increase in the wage rate. 
C) a decrease in the price of a substitute factor of production. 
D) an increase in the price of a substitute factor of production. 
E) a decrease in the wage rate.

Question 19

If the rate of interest is 15 percent per year, the present value of the $200 to be received in two years is

Accepted Answer

A) $170.00. 
B) $185.00. 
C) $173.91. 
D) $264.50. 
E) $151.23. 
A) $170.00. 
B) $185.00. 
C) $173.91. 
D) $264.50. 
E) $151.23.

Question 20

The tax system at both the federal and provincial levels is

Accepted Answer

A) progressive. 
B) regressive. 
C) proportional. 
D) a combination of proportional and regressive. 
E) a combination of progressive and regressive. 
A) progressive. 
B) regressive. 
C) proportional. 
D) a combination of proportional and regressive. 
E) a combination of progressive and regressive.

The wealthiest 10 percent of Canadian families own approximately

Suppose a profit-maximizing firm hires labour in a competitive labour market.If the value of marginal product of labour is greater than the wage rate, the firm should

The income effect of a higher wage is defined as

A technological change that increases the value of marginal product of labour shifts the labour

New technology has allowed oil to be pumped from much deeper offshore oil fields than before.For example, 28 deep ocean rigs operate in the deep waters of the Gulf of Mexico.Deep ocean sources have the world price of oil.Those who benefit from drilling for oil in the Gulf of Mexico are .

The value of marginal product of labour is the revenue

Table 18.3.1 -Refer to Table 18.3.1.Table 18.3.1 gives information about the labour market in Lantis, a community in which the labour market is perfectly competitive.The equilibrium wage rate is an hour and the quantity of labour employed is hours per day.

If the present value of $100 received one year from now is $80, what is the annual interest rate?

Use the figure below to answer the following questions. Figure 19.1.3 -In Figure 19.1.3, the poorest 20 percent of all families receive what share of income?

Use the figure below to answer the following questions. Figure 19.3.2 -Refer to Figure 19.3.2.At a wage rate of $5, an employer would hire

The four factors of production are

Assortative mating means that

Choose the statement that is incorrect.

The demand curve for labour will shift rightward as a result of

If the rate of interest is 15 percent per year, the present value of the $200 to be received in two years is

The tax system at both the federal and provincial levels is

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Filters

Exam 18: Markets for Factors of Production

The wealthiest 10 percent of Canadian families own approximately

Suppose a profit-maximizing firm hires labour in a competitive labour market.If the value of marginal product of labour is greater than the wage rate, the firm should

The income effect of a higher wage is defined as

A technological change that increases the value of marginal product of labour shifts the labour

The value of marginal product of labour is the revenue

Table 18.3.1 -Refer to Table 18.3.1.Table 18.3.1 gives information about the labour market in Lantis, a community in which the labour market is perfectly competitive.The equilibrium wage rate is ________ an hour and the quantity of labour employed is ________ hours per day.

If the present value of $100 received one year from now is $80, what is the annual interest rate?

Use the figure below to answer the following questions. Figure 19.1.3 -In Figure 19.1.3, the poorest 20 percent of all families receive what share of income?

Use the figure below to answer the following questions. Figure 19.3.2 -Refer to Figure 19.3.2.At a wage rate of $5, an employer would hire

The four factors of production are

Assortative mating means that

Choose the statement that is incorrect.

The demand curve for labour will shift rightward as a result of

If the rate of interest is 15 percent per year, the present value of the $200 to be received in two years is

The tax system at both the federal and provincial levels is

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Filters

Table 18.3.1 -Refer to Table 18.3.1.Table 18.3.1 gives information about the labour market in Lantis, a community in which the labour market is perfectly competitive.The equilibrium wage rate is an hour and the quantity of labour employed is hours per day.