Exam 15: Factor Markets

A state lottery has a Million Dollar Lottery game that pays $1,000 a week for life.Assuming a 6% nominal rate of interest and generously assuming an infinite lifetime,can this game be called a "Million Dollar Lottery"?

In a perfectly competitive resource market,the Marginal Revenue Product Curve is

At age 40,Joe is considering quitting his job and going back for a college degree.He needs two more years full-time.Tuition is $10,000 per year.He earns $30,000 per year.A college degree would raise his annual income by $10,000 per year.He will retire at age 70.From an investment standpoint,Joe will go back full-time if

If a firm buys its labor in a competitive market,then in the short run,a decrease of the demand for the firm's product will cause the firm to

One explanation that behavioral economists give for procrastination and other time-inconsistent behavior is

A monopoly's demand curve for labor

The spread between price and marginal cost of an exhaustible resource must grow by the rate of interest so that

XYZ Co.operates in a competitive market.Its production function is q = .The exponents,α and β,are both less than one.The firm's capital is fixed,and it takes the wage and price as given.Derive the firm's short-run demand for labor as a function of K,w,and p.How does the firm react to an increase in the wage rate?

-The above figure shows a competitive firm's demand for labor assuming that the firm's output sells for $1 per unit.If the wage is $5 per hour,a 2 percent cut in all the workers' income tax will cause the firm to

If a firm needs one machine to produce a product,and must replace the machine when it wears out,then the firm should pick a durability level of the machine that

A change in the wage causes a shift in the supply curve for labor and a

As the interest rate rises,the present value of a given perpetual stream of income

For the following, please answer "True" or "False" and explain why. -The marginal revenue product of labor is usually downward sloping.

For a monopoly,the value of the next worker equals

In using the Internal Rate of Return approach,one must first calculate the discount rate on the investment that makes

If a competitive firm faces a competitive labor market,it will hire labor until

If the interest rate is 10%,then $1 today is worth how much one year from now?

At age 40,Joe is considering quitting his job and going back for a college degree.He needs two more years full-time.Tuition is $10,000 per year.He earns $30,000 per year.A college degree would raise his annual income by $10,000 per year.He will retire at age 70.Which of the following makes it less likely that Joe will decide to go back to college full-time?

Suppose the marginal product of labor equals 1/L.If the firm can sell its output for $10 per unit,and the wage is $1 per unit,how many units of labor will the firm hire?

Suppose the market demand elasticity is constant at -2,and there are three identical firms in the oligopolistic market.A Cournot firm's MPL = 1.2L⁻⁰.⁵,then the labor demand for a Cournot firm is