Question 1

For a firm selling its product in a perfectly competitive market, the demand curve for a factor of production is downward sloping because

Accepted Answer

A) of the diminishing marginal product of the factor. 
B) to sell more output, the firm must lower the price of its product. 
C) firms must hire more factors of production if they want to increase their output. 
D) a factor's marginal product increases when the price of the factor increases. 
E) None of the above answers is correct. 
A) of the diminishing marginal product of the factor. 
B) to sell more output, the firm must lower the price of its product. 
C) firms must hire more factors of production if they want to increase their output. 
D) a factor's marginal product increases when the price of the factor increases. 
E) None of the above answers is correct.

Question 2

What is the relationship between a firm's value of marginal product curve of labor and its demand for labor curve? Explain why this relationship exists.

Accepted Answer

The value of marginal product curve for

Question 3

Because leisure time has value to many workers, as wages increase the labor supply curve

Accepted Answer

A) has a positive slope. 
B) bends backwards and has a negative slope. 
C) becomes a horizontal line. 
D) becomes a vertical line. 
E) bends forward and has a positive slope. 
A) has a positive slope. 
B) bends backwards and has a negative slope. 
C) becomes a horizontal line. 
D) becomes a vertical line. 
E) bends forward and has a positive slope.

Question 4

If the supply of labor decreases, then the equilibrium wage rate ________ and equilibrium employment ________.

Accepted Answer

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

Question 5

What factors other than the wage rate influence the demand for labor? How is demand affected by changes in these factors?

Accepted Answer

The demand for labor is influenced by ch

Question 6

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 7

If the supply of a factor is perfectly inelastic, then

Accepted Answer

A) no more than the existing quantity can be supplied. 
B) the supply curve is horizontal. 
C) sellers will provide whatever quantity is demanded at the going price. 
D) a rise in price results in no quantity being supplied. 
E) a fall in price results in no quantity being supplied. 
A) no more than the existing quantity can be supplied. 
B) the supply curve is horizontal. 
C) sellers will provide whatever quantity is demanded at the going price. 
D) a rise in price results in no quantity being supplied. 
E) a fall in price results in no quantity being supplied.

Question 8

The value of the marginal product of labor is calculated by multiplying the ________ by the ________.

Accepted Answer

A) quantity of labor; wage rate 
B) total product; wage rate 
C) marginal product of labor; price of a unit of the output 
D) wage rate; price of a unit of the output 
E) marginal product of labor; wage rate 
A) quantity of labor; wage rate 
B) total product; wage rate 
C) marginal product of labor; price of a unit of the output 
D) wage rate; price of a unit of the output 
E) marginal product of labor; wage rate

Question 9

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 10

Robotic technology is a substitute for labor in many manufacturing processes.If the price of robotic technology decreases and the scale of the firm's production does not change, there is

Accepted Answer

A) a decrease in the demand for labor. 
B) an increase in the demand for labor. 
C) no change in the demand for labor. 
D) an increase in the supply of labor. 
E) a decrease in the supply of labor. 
A) a decrease in the demand for labor. 
B) an increase in the demand for labor. 
C) no change in the demand for labor. 
D) an increase in the supply of labor. 
E) a decrease in the supply of labor.

Question 11

The value of marginal product of labor is equal to the marginal product of labor ________ the price of a unit of output.

Accepted Answer

A) divided by 
B) multiplied by 
C) minus 
D) plus 
E) squared and then multiplied by 
A) divided by 
B) multiplied by 
C) minus 
D) plus 
E) squared and then multiplied by

Question 12

Which of the following is NOT a method by which unions try to increase the demand for the labor of their members?

Accepted Answer

A) increasing the marginal product of union members 
B) increasing the supply of the goods produced by union labor 
C) supporting minimum wage laws 
D) supporting import restrictions 
E) supporting immigration restrictions 
A) increasing the marginal product of union members 
B) increasing the supply of the goods produced by union labor 
C) supporting minimum wage laws 
D) supporting import restrictions 
E) supporting immigration restrictions

Question 13

In the labor market,

Accepted Answer

A) households demand labor. 
B) firms demand labor. 
C) firms supply labor. 
D) wage are determined only by firms alone. 
E) None of the above answers is correct. 
A) households demand labor. 
B) firms demand labor. 
C) firms supply labor. 
D) wage are determined only by firms alone. 
E) None of the above answers is correct.

Question 14

If both the demand for labor and the supply of labor increase, then the equilibrium wage rate ________ and the equilibrium quantity of labor ________.

Accepted Answer

A) rises; increases 
B) might rise, fall, or not change; increases 
C) rises; might increase, decrease, or not change 
D) falls; increases 
E) falls; decreases 
A) rises; increases 
B) might rise, fall, or not change; increases 
C) rises; might increase, decrease, or not change 
D) falls; increases 
E) falls; decreases

Question 15

Tom and Mary grow tomatoes.They can hire different numbers of college students to help plant, cultivate, and harvest the tomatoes.The table below gives their marginal product schedule.
   
a∙If the price of a pound of tomatoes is $2 a pound, complete the first value of marginal product column in the table.If Tom and Mary must pay their workers $10 an hour, how many workers do they hire?
b∙If the price of a pound of tomatoes falls to $1 a pound, complete the second value of marginal product column in the table.If Tom and Mary still must pay their workers $10 an hour, how many workers do they hire?
c∙When the price of a pound of tomatoes falls, what happens to Tom and Mary's demand for labor curve?

Accepted Answer

@#IMG-DLM& 
a∙The completed table is above.Tom and

Question 16

What factors shift the demand for labor curve? Briefly describe the effect of each.

Accepted Answer

Three factors shift the demand for labor

Question 17

If we compare the value of marginal product of labor curve and the demand for labor curve we see that

Accepted Answer

A) they are the same thing. 
B) the value of marginal product curve is twice as steep. 
C) the demand for labor curve has no relationship to the value of marginal product curve. 
D) the demand for labor curve is twice as steep but they share the same axes. 
E) the demand for labor curve lies above the value of marginal product curve. 
A) they are the same thing. 
B) the value of marginal product curve is twice as steep. 
C) the demand for labor curve has no relationship to the value of marginal product curve. 
D) the demand for labor curve is twice as steep but they share the same axes. 
E) the demand for labor curve lies above the value of marginal product curve.

Question 18

What is meant by derived demand?

Accepted Answer

A) The demand is derived from income, tastes, etc. of sellers. 
B) The demand for a resource is derived from the demand for what it can produce. 
C) The demand is derived from the price elasticity of demand. 
D) The demand exists because the government mandates production of the good. 
E) The demand for a good is derived from the supply of the good. 
A) The demand is derived from income, tastes, etc. of sellers. 
B) The demand for a resource is derived from the demand for what it can produce. 
C) The demand is derived from the price elasticity of demand. 
D) The demand exists because the government mandates production of the good. 
E) The demand for a good is derived from the supply of the good.

Question 19

A natural resource is renewable if it

Accepted Answer

A) never has to rest. 
B) can be used repeatedly. 
C) cannot be replaced once it has been used. 
D) is available at a price of zero. 
E) has a perfectly elastic supply. 
A) never has to rest. 
B) can be used repeatedly. 
C) cannot be replaced once it has been used. 
D) is available at a price of zero. 
E) has a perfectly elastic supply.

Question 20

-The table above shows a the total product schedule of Piece a' Pi, a producer of pizza in a nearby college town.Suppose workers are paid $12 per hour and the price per pizza is $10.The value of marginal product of the fifth worker is ________ per hour.

Accepted Answer

A) $240 
B) $220 
C) $24 
D) $10 
E) $12 
A) $240 
B) $220 
C) $24 
D) $10 
E) $12

For a firm selling its product in a perfectly competitive market, the demand curve for a factor of production is downward sloping because

What is the relationship between a firm's value of marginal product curve of labor and its demand for labor curve? Explain why this relationship exists.

Because leisure time has value to many workers, as wages increase the labor supply curve

If the supply of labor decreases, then the equilibrium wage rate and equilibrium employment .

What factors other than the wage rate influence the demand for labor? How is demand affected by changes in these factors?

The demand curve for a factor of production is

If the supply of a factor is perfectly inelastic, then

The value of the marginal product of labor is calculated by multiplying the by the .

A producer's supply of a nonrenewable natural resource is

Robotic technology is a substitute for labor in many manufacturing processes.If the price of robotic technology decreases and the scale of the firm's production does not change, there is

The value of marginal product of labor is equal to the marginal product of labor ________ the price of a unit of output.

Which of the following is NOT a method by which unions try to increase the demand for the labor of their members?

In the labor market,

If both the demand for labor and the supply of labor increase, then the equilibrium wage rate and the equilibrium quantity of labor .

What factors shift the demand for labor curve? Briefly describe the effect of each.

If we compare the value of marginal product of labor curve and the demand for labor curve we see that

What is meant by derived demand?

A natural resource is renewable if it

-The table above shows a the total product schedule of Piece a' Pi, a producer of pizza in a nearby college town.Suppose workers are paid $12 per hour and the price per pizza is $10.The value of marginal product of the fifth worker is ________ per hour.

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

For a firm selling its product in a perfectly competitive market, the demand curve for a factor of production is downward sloping because

What is the relationship between a firm's value of marginal product curve of labor and its demand for labor curve? Explain why this relationship exists.

Because leisure time has value to many workers, as wages increase the labor supply curve

If the supply of labor decreases, then the equilibrium wage rate ________ and equilibrium employment ________.

What factors other than the wage rate influence the demand for labor? How is demand affected by changes in these factors?

The demand curve for a factor of production is

If the supply of a factor is perfectly inelastic, then

The value of the marginal product of labor is calculated by multiplying the ________ by the ________.

A producer's supply of a nonrenewable natural resource is

Robotic technology is a substitute for labor in many manufacturing processes.If the price of robotic technology decreases and the scale of the firm's production does not change, there is

The value of marginal product of labor is equal to the marginal product of labor ________ the price of a unit of output.

Which of the following is NOT a method by which unions try to increase the demand for the labor of their members?

In the labor market,

If both the demand for labor and the supply of labor increase, then the equilibrium wage rate ________ and the equilibrium quantity of labor ________.

What factors shift the demand for labor curve? Briefly describe the effect of each.

If we compare the value of marginal product of labor curve and the demand for labor curve we see that

What is meant by derived demand?

A natural resource is renewable if it

-The table above shows a the total product schedule of Piece a' Pi, a producer of pizza in a nearby college town.Suppose workers are paid $12 per hour and the price per pizza is $10.The value of marginal product of the fifth worker is ________ per hour.

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 the supply of labor decreases, then the equilibrium wage rate and equilibrium employment .

The value of the marginal product of labor is calculated by multiplying the by the .

If both the demand for labor and the supply of labor increase, then the equilibrium wage rate and the equilibrium quantity of labor .