Question 1

What is the official definition of the poverty line? What are some causes of poverty?

Accepted Answer

The official definition of the poverty l

Question 2

If the wage rate is fixed at a certain level,the:

Accepted Answer

A)  labor supply curve is horizontal. 
B)  labor supply is a straight upward sloping line. 
C)  MP must be constant. 
D)  labor supply will increase at an increasing rate. 
E)  labor supply will increase at a decreasing rate. 
A)  labor supply curve is horizontal. 
B)  labor supply is a straight upward sloping line. 
C)  MP must be constant. 
D)  labor supply will increase at an increasing rate. 
E)  labor supply will increase at a decreasing rate.

Question 3

The government defines poverty as an income level less than four times the cost of a minimal diet.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following would cause the demand for labor to change?

Accepted Answer

A) c and e. 
B) A change in the cost of living. 
C) Changes in the wage rate. 
D) Movements along the labor demand curve. 
E) A change in the price of the good produced. 
A) c and e. 
B) A change in the cost of living. 
C) Changes in the wage rate. 
D) Movements along the labor demand curve. 
E) A change in the price of the good produced.

Question 5

Exhibit 10-7 Income distribution for three countries
  
-Exhibit 10-7 shows the percentage of income received by each population quintile.From this chart we can conclude:

Accepted Answer

A)  Country I has the most unequal income distribution. 
B)  Country III has the most equal income distribution. 
C)  Country II has the most unequal income distribution. 
D)  Country II has the most equal income distribution. 
E)  Country III has a more equal income distribution than Country II. 
A)  Country I has the most unequal income distribution. 
B)  Country III has the most equal income distribution. 
C)  Country II has the most unequal income distribution. 
D)  Country II has the most equal income distribution. 
E)  Country III has a more equal income distribution than Country II.

Question 6

Exhibit 10-3 Supply and demand curves for food servers
  
-In Exhibit 10-3,suppose that in the interest of boosting incomes of the working poor,Congress imposes a minimum wage of $6.00 per hour.This minimum wage rate creates a(n):

Accepted Answer

A)  new labor market equilibrium. 
B)  excess demand for labor of 10 thousand food servers. 
C)  excess supply of labor of food servers. 
D)  situation of full employment for food servers. 
A)  new labor market equilibrium. 
B)  excess demand for labor of 10 thousand food servers. 
C)  excess supply of labor of food servers. 
D)  situation of full employment for food servers.

Question 7

The Social Security Act was passed:

Accepted Answer

A)  in 1955. 
B)  just after World War II. 
C)  in 1935. 
D)  in 1964. 
A)  in 1955. 
B)  just after World War II. 
C)  in 1935. 
D)  in 1964.

Question 8

Since 1929,the distribution of income in the United States has become:

Accepted Answer

A)  substantially more equal. 
B)  slightly more equal. 
C)  slightly more unequal. 
D)  substantially more unequal. 
A)  substantially more equal. 
B)  slightly more equal. 
C)  slightly more unequal. 
D)  substantially more unequal.

Question 9

Make a case for income inequality.

Accepted Answer

First,by rewarding people for their prod

Question 10

An example of in-kind assistance to the poor is TANF.

Accepted Answer

A) True 
 B)False

Question 11

Starting in 1964,the U.S.government has defined the poverty line as income at or below ____ the amount of money needed to buy a minimum diet for all family members.

Accepted Answer

A)  two times 
B)  three times 
C)  four times 
D)  five times 
A)  two times 
B)  three times 
C)  four times 
D)  five times

Question 12

In the United States,approximately what percentage of the total income is earned by the highest 5 percent of the families?

Accepted Answer

A)  10 percent. 
B)  20 percent. 
C)  30 percent. 
D)  40 percent. 
A)  10 percent. 
B)  20 percent. 
C)  30 percent. 
D)  40 percent.

Question 13

If the marginal product of labor is always positive,the total revenue will grow with each additional worker.Firms do not continuously hire new workers because:

Accepted Answer

A)  there isn't enough room in the factory. 
B)  there isn't an infinite number of workers. 
C)  wages would have to increase. 
D)  they stop when MRP = wage 
E)  marginal revenue product will become negative. 
A)  there isn't enough room in the factory. 
B)  there isn't an infinite number of workers. 
C)  wages would have to increase. 
D)  they stop when MRP = wage 
E)  marginal revenue product will become negative.

Question 14

The marginal cost of labor for a perfectly competitive firm is given by:

Accepted Answer

A)  the change in total revenue that results from employing an additional worker. 
B)  the market wage rate. 
C)  its marginal revenue product curve. 
D)  the demand curve for labor. 
E)  the marginal product of labor. 
A)  the change in total revenue that results from employing an additional worker. 
B)  the market wage rate. 
C)  its marginal revenue product curve. 
D)  the demand curve for labor. 
E)  the marginal product of labor.

Question 15

If more and better technology is used for producing wheat in the United States than in a lesser-developed country,then the:

Accepted Answer

A)  MRP of the U.S. workers will be higher than the MRP of the workers in the lesser-developed country. 
B)  MRP of the U.S. workers will be lower than the MRP of the workers in the lesser-developed country. 
C)  demand for the U.S. workers will be lower than the demand for the workers in the lesser developed country. 
D)  price of wheat will be higher in the United States than in the lesser-developed country. 
E)  wages of the U.S. workers will be lower than the wages of the workers in the lesser-developed country. 
A)  MRP of the U.S. workers will be higher than the MRP of the workers in the lesser-developed country. 
B)  MRP of the U.S. workers will be lower than the MRP of the workers in the lesser-developed country. 
C)  demand for the U.S. workers will be lower than the demand for the workers in the lesser developed country. 
D)  price of wheat will be higher in the United States than in the lesser-developed country. 
E)  wages of the U.S. workers will be lower than the wages of the workers in the lesser-developed country.

Question 16

If the MRP of labor decreases,labor:

Accepted Answer

A)  demand will decrease. 
B)  demand will increase. 
C)  supply will increase. 
D)  supply will decrease. 
E)  demand and supply will be unaffected. 
A)  demand will decrease. 
B)  demand will increase. 
C)  supply will increase. 
D)  supply will decrease. 
E)  demand and supply will be unaffected.

Question 17

The optimal hiring rule is to employ labor up to the point where:

Accepted Answer

A)  wage = MFC. 
B)  wage = MP. 
C)  wage = MR 
D)  wage = MRP 
E)  wage = TWC. 
A)  wage = MFC. 
B)  wage = MP. 
C)  wage = MR 
D)  wage = MRP 
E)  wage = TWC.

Question 18

Exhibit 10-1 Labor and output data
  
-In Exhibit 10-1,the marginal product of the 3rd unit of labor is equal to:

Accepted Answer

A)  80. 
B)  45. 
C)  35. 
D)  100. 
E)  25. 
A)  80. 
B)  45. 
C)  35. 
D)  100. 
E)  25.

Question 19

Alan Jones owns a company that sells life insurance.When he employs 10 salespersons his firm sells $200,000 worth of contracts per week,and when he employs 11 salespersons,total revenue is $210,000.The marginal revenue product of the 11th salesperson is:

Accepted Answer

A)  $410,000. 
B)  $10,000. 
C)  $20,000. 
D)  $210,000. 
A)  $410,000. 
B)  $10,000. 
C)  $20,000. 
D)  $210,000.

Question 20

An apple orchard currently hires 10 workers.The owner estimates that hiring an additional worker would increase apple yields by 20 bushels per day.The price of apples is $15 per bushel.The owner should hire the extra worker if the wage rate is no greater than:

Accepted Answer

A)  $50 per day. 
B)  $150 per day. 
C)  $200 per day. 
D)  $300 per day. 
A)  $50 per day. 
B)  $150 per day. 
C)  $200 per day. 
D)  $300 per day.

Exam 10: Labor Markets and Income Distribution

What is the official definition of the poverty line? What are some causes of poverty?

If the wage rate is fixed at a certain level,the:

The government defines poverty as an income level less than four times the cost of a minimal diet.

Which of the following would cause the demand for labor to change?

Exhibit 10-7 Income distribution for three countries -Exhibit 10-7 shows the percentage of income received by each population quintile.From this chart we can conclude:

Exhibit 10-3 Supply and demand curves for food servers -In Exhibit 10-3,suppose that in the interest of boosting incomes of the working poor,Congress imposes a minimum wage of $6.00 per hour.This minimum wage rate creates a(n):

The Social Security Act was passed:

Since 1929,the distribution of income in the United States has become:

Make a case for income inequality.

An example of in-kind assistance to the poor is TANF.

Starting in 1964,the U.S.government has defined the poverty line as income at or below ____ the amount of money needed to buy a minimum diet for all family members.

In the United States,approximately what percentage of the total income is earned by the highest 5 percent of the families?

If the marginal product of labor is always positive,the total revenue will grow with each additional worker.Firms do not continuously hire new workers because:

The marginal cost of labor for a perfectly competitive firm is given by:

If more and better technology is used for producing wheat in the United States than in a lesser-developed country,then the:

If the MRP of labor decreases,labor:

The optimal hiring rule is to employ labor up to the point where:

Exhibit 10-1 Labor and output data -In Exhibit 10-1,the marginal product of the 3rd unit of labor is equal to:

Alan Jones owns a company that sells life insurance.When he employs 10 salespersons his firm sells $200,000 worth of contracts per week,and when he employs 11 salespersons,total revenue is $210,000.The marginal revenue product of the 11th salesperson is:

An apple orchard currently hires 10 workers.The owner estimates that hiring an additional worker would increase apple yields by 20 bushels per day.The price of apples is $15 per bushel.The owner should hire the extra worker if the wage rate is no greater than:

Introducing the Economic Way of Thinking

A: Appendix: Applying Graphs to Economics

Production Possibilities,Opportunity Cost,and Economic Growth

Part 1: Market Demand and Supply

Part 2: Market Demand and Supply

Markets in Action

Price Elasticity of Demand

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gross Domestic Product

Business Cycles and Unemployment

Inflation

Aggregate Demand and Supply

A: Appendix: The Self-Correcting Aggregate Demand and Supply Model

Fiscal Policy

The Public Sector

Federal Deficits,Surpluses,and the National Debt

Money and the Federal Reserve System

Money Creation

Monetary Policy

A: Appendix: Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model

International Trade and Finance

Economies in Transition

Growth and the Less-Developed Countries

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