Question 1

A technological change that raises the value of marginal product of capital ________ the rental rate for capital because the ________.

Accepted Answer

A) raises; supply curve of capital shifts leftward 
B) lowers; supply curve of capital shifts rightward 
C) raises; demand curve for capital shifts leftward 
D) raises; demand curve for capital shifts rightward 
E) lowers; demand curve for capital shifts leftward 
A) raises; supply curve of capital shifts leftward 
B) lowers; supply curve of capital shifts rightward 
C) raises; demand curve for capital shifts leftward 
D) raises; demand curve for capital shifts rightward 
E) lowers; demand curve for capital shifts leftward

Question 2

Other things remaining the same, the

Accepted Answer

A) higher the rental rate of capital, the greater the quantity of capital demanded. 
B) lower the rental rate of capital, the smaller the quantity of capital demanded. 
C) higher the rental rate of capital, the smaller the quantity of capital demanded. 
D) rental rate of capital and the quantity of capital demanded are not related. 
E) higher the rental rate of capital, the more the demand for capital decreases. 
A) higher the rental rate of capital, the greater the quantity of capital demanded. 
B) lower the rental rate of capital, the smaller the quantity of capital demanded. 
C) higher the rental rate of capital, the smaller the quantity of capital demanded. 
D) rental rate of capital and the quantity of capital demanded are not related. 
E) higher the rental rate of capital, the more the demand for capital decreases.

Question 3

-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 one trainer, the value of marginal product of this trainer equals

Accepted Answer

A) 4 clients. 
B) $164. 
C) $410. 
D) $41. 
E) None of the above answers is correct. 
A) 4 clients. 
B) $164. 
C) $410. 
D) $41. 
E) None of the above answers is correct.

Question 4

What tools can unions use to increase the demand for union labor?

Accepted Answer

The main tools that unions use to increa

Question 5

The aggregate quantity of land supplied

Accepted Answer

A) varies depending on its price. 
B) depends on the buying and selling decisions of individuals. 
C) is constantly increasing. 
D) is fixed. 
E) is perfectly elastic. 
A) varies depending on its price. 
B) depends on the buying and selling decisions of individuals. 
C) is constantly increasing. 
D) is fixed. 
E) is perfectly elastic.

Question 6

The figure above shows a firm's VMP curve.
-Suppose that a new technology doubles the marginal product of the workers and the price of the product does not change.As a result, the value of marginal product of the second worker

Accepted Answer

A) remains $12. 
B) becomes $6. 
C) becomes $24. 
D) becomes $30. 
E) More information about the supply of labor is needed to answer the question. 
A) remains $12. 
B) becomes $6. 
C) becomes $24. 
D) becomes $30. 
E) More information about the supply of labor is needed to answer the question.

Question 7

When the rental rate for capital falls, the ________ capital ________.

Accepted Answer

A) demand for; increases 
B) demand for; decreases 
C) quantity demanded of; increases 
D) quantity demanded of; decreases 
E) supply of; increases 
A) demand for; increases 
B) demand for; decreases 
C) quantity demanded of; increases 
D) quantity demanded of; decreases 
E) supply of; increases

Question 8

Why does a profit-maximizing firm hire labor up to the point where the value of marginal product equals the wage rate?

Accepted Answer

If a company stopped adding workers at t

Question 9

Unions support immigration restrictions because the restrictions create

Accepted Answer

A) an increase in the supply of union labor. 
B) a decrease in the supply of union labor. 
C) unemployment. 
D) an increase in the demand for union labor. 
E) a decrease in the demand for union labor. 
A) an increase in the supply of union labor. 
B) a decrease in the supply of union labor. 
C) unemployment. 
D) an increase in the demand for union labor. 
E) a decrease in the demand for union labor.

Question 10

The value of the marginal product is equal to

Accepted Answer

A) marginal product × marginal cost. 
B) marginal product × product price. 
C) marginal revenue × marginal cost. 
D) marginal cost × product price. 
E) marginal product ÷ product price. 
A) marginal product × marginal cost. 
B) marginal product × product price. 
C) marginal revenue × marginal cost. 
D) marginal cost × product price. 
E) marginal product ÷ product price.

Question 11

If a nonrenewable natural resource's price is expected to increase at a rate faster than the interest rate, then the

Accepted Answer

A) owners will sell all that they can today. 
B) owners will sell nothing today. 
C) consumers will demand nothing today. 
D) owners will sell their entire supply. 
E) current price will probably fall. 
A) owners will sell all that they can today. 
B) owners will sell nothing today. 
C) consumers will demand nothing today. 
D) owners will sell their entire supply. 
E) current price will probably fall.

Question 12

The supply of each particular block of land is

Accepted Answer

A) perfectly elastic. 
B) unit elastic. 
C) elastic but not perfectly elastic. 
D) perfectly inelastic. 
E) inelastic but not perfectly inelastic. 
A) perfectly elastic. 
B) unit elastic. 
C) elastic but not perfectly elastic. 
D) perfectly inelastic. 
E) inelastic but not perfectly inelastic.

Question 13

-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 14

If a union is able to organize workers in a competitive labor market but the union cannot affect the demand for its members' labor, then the wage rate ________ and the quantity of labor hired ________.

Accepted Answer

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

Question 15

Which of the following is NOT a method used by union to increase their members' wages?

Accepted Answer

A) Limit the supply of non-union workers. 
B) Increase the demand for union workers. 
C) Support minimum wage increases. 
D) Increase union members' productivity. 
E) None of the above because they are all methods unions use to increase their members' wages. 
A) Limit the supply of non-union workers. 
B) Increase the demand for union workers. 
C) Support minimum wage increases. 
D) Increase union members' productivity. 
E) None of the above because they are all methods unions use to increase their members' wages.

Question 16

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 17

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.

Question 18

The equilibrium quantity of capital is

Accepted Answer

A) determined by only the supply of capital because the supply is perfectly inelastic. 
B) determined by only the supply of capital because the supply is perfectly elastic. 
C) expected to increase at the same rate as the interest rate. 
D) determined by the supply of capital and the demand for capital. 
E) the only factor of production whose quantity is not determined in a market. 
A) determined by only the supply of capital because the supply is perfectly inelastic. 
B) determined by only the supply of capital because the supply is perfectly elastic. 
C) expected to increase at the same rate as the interest rate. 
D) determined by the supply of capital and the demand for capital. 
E) the only factor of production whose quantity is not determined in a market.

Question 19

The value of marginal product is equal to the

Accepted Answer

A) additional revenue from selling one more unit of the product. 
B) change in total revenue from selling one more unit of product. 
C) additional cost of hiring one more unit of a factor of production. 
D) change in revenue from hiring one more unit of a factor of production. 
E) change in total cost when one more unit of the product is produced. 
A) additional revenue from selling one more unit of the product. 
B) change in total revenue from selling one more unit of product. 
C) additional cost of hiring one more unit of a factor of production. 
D) change in revenue from hiring one more unit of a factor of production. 
E) change in total cost when one more unit of the product is produced.

Question 20

A firm's demand for labor curve is also

Accepted Answer

A) its value of marginal product of labor curve. 
B) the demand curve for the good it produces. 
C) the supply of labor curve. 
D) its marginal cost curve. 
E) the supply curve for the good it produces. 
A) its value of marginal product of labor curve. 
B) the demand curve for the good it produces. 
C) the supply of labor curve. 
D) its marginal cost curve. 
E) the supply curve for the good it produces.

A technological change that raises the value of marginal product of capital the rental rate for capital because the .

Other things remaining the same, the

-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 one trainer, the value of marginal product of this trainer equals

What tools can unions use to increase the demand for union labor?

The aggregate quantity of land supplied

The figure above shows a firm's VMP curve. -Suppose that a new technology doubles the marginal product of the workers and the price of the product does not change.As a result, the value of marginal product of the second worker

When the rental rate for capital falls, the capital .

Why does a profit-maximizing firm hire labor up to the point where the value of marginal product equals the wage rate?

Unions support immigration restrictions because the restrictions create

The value of the marginal product is equal to

If a nonrenewable natural resource's price is expected to increase at a rate faster than the interest rate, then the

The supply of each particular block of land is

-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,

If a union is able to organize workers in a competitive labor market but the union cannot affect the demand for its members' labor, then the wage rate and the quantity of labor hired .

Which of the following is NOT a method used by union to increase their members' wages?

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

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

The equilibrium quantity of capital is

The value of marginal product is equal to the

A firm's demand for labor curve is also

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

A technological change that raises the value of marginal product of capital ________ the rental rate for capital because the ________.

Other things remaining the same, the

-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 one trainer, the value of marginal product of this trainer equals

What tools can unions use to increase the demand for union labor?

The aggregate quantity of land supplied

The figure above shows a firm's VMP curve. -Suppose that a new technology doubles the marginal product of the workers and the price of the product does not change.As a result, the value of marginal product of the second worker

When the rental rate for capital falls, the ________ capital ________.

Why does a profit-maximizing firm hire labor up to the point where the value of marginal product equals the wage rate?

Unions support immigration restrictions because the restrictions create

The value of the marginal product is equal to

If a nonrenewable natural resource's price is expected to increase at a rate faster than the interest rate, then the

The supply of each particular block of land is

-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,

If a union is able to organize workers in a competitive labor market but the union cannot affect the demand for its members' labor, then the wage rate ________ and the quantity of labor hired ________.

Which of the following is NOT a method used by union to increase their members' wages?

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

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

The equilibrium quantity of capital is

The value of marginal product is equal to the

A firm's demand for labor curve is also

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

A technological change that raises the value of marginal product of capital the rental rate for capital because the .

When the rental rate for capital falls, the capital .

If a union is able to organize workers in a competitive labor market but the union cannot affect the demand for its members' labor, then the wage rate and the quantity of labor hired .