Question 1

If a union can successfully shift the demand curve for union labor rightward, the union can achieve

Accepted Answer

A)  an increase in wages and employment. 
B)  an increase in wages but a decrease in employment. 
C)  an increase in employment but a decrease in wages. 
D)  a decrease in both employment and wages. 
A)  an increase in wages and employment. 
B)  an increase in wages but a decrease in employment. 
C)  an increase in employment but a decrease in wages. 
D)  a decrease in both employment and wages.

Question 2

Starbucks sells coffee in both New York City and in rural upstate New York. The price of coffee is higher in New York City. This fact means that the value of marginal product of land is ________ in New York City and so Starbucks is willing to pay a ________ rent in New York City.

Accepted Answer

A)  lower; lower 
B)  higher; lower 
C)  lower; higher 
D)  higher; higher 
A)  lower; lower 
B)  higher; lower 
C)  lower; higher 
D)  higher; higher

Question 3

The value of marginal product equals marginal product

Accepted Answer

A)  multiplied by the quantity of labor. 
B)  divided by the quantity of labor. 
C)  multiplied by the good's market price. 
D)  divided by the good's market price. 
A)  multiplied by the quantity of labor. 
B)  divided by the quantity of labor. 
C)  multiplied by the good's market price. 
D)  divided by the good's market price.

Question 4

-The table above shows the number of pounds of bricks that can be produced by the Red Brick Company as the number of workers hired increases. The brick market is perfectly competitive and each pound of bricks sells for $20. The labor market is competitive and the wage rate is $30 an hour. When the Red Brick Company maximizes its profit, it produces ________ bricks an hour.

Accepted Answer

A)  19 
B)  21 
C)  22 
D)  10 
A)  19 
B)  21 
C)  22 
D)  10

Question 5

The value of marginal product of labor is the ________ when one additional unit of a labor is employed, all other things remaining the same.

Accepted Answer

A)  change in marginal revenue 
B)  change in marginal product 
C)  change in total revenue 
D)  total revenue 
A)  change in marginal revenue 
B)  change in marginal product 
C)  change in total revenue 
D)  total revenue

Question 6

-You observe that more labor is employed and the wage rate increases. This set of events could have been the result of a

Accepted Answer

A)  rightward shift of the labor demand curve. 
B)  leftward shift of the labor supply curve. 
C)  rightward shift of the labor supply curve. 
D)  leftward shift of the labor demand curve. 
A)  rightward shift of the labor demand curve. 
B)  leftward shift of the labor supply curve. 
C)  rightward shift of the labor supply curve. 
D)  leftward shift of the labor demand curve.

Question 7

For a perfectly competitive firm, the value of marginal product diminishes as employment increases because the

Accepted Answer

A)  price falls as the firm's production increases. 
B)  marginal revenue decreases as the firm's production increases. 
C)  marginal product decreases as the firm's production increases. 
D)  None of the above answers is correct. 
A)  price falls as the firm's production increases. 
B)  marginal revenue decreases as the firm's production increases. 
C)  marginal product decreases as the firm's production increases. 
D)  None of the above answers is correct.

Question 8

The demand for a productive resource, not for its own sake, but for use in the production of goods and services is called a ________.

Accepted Answer

A)  goods and services demand 
B)  production demand 
C)  derived demand 
D)  resource demand 
A)  goods and services demand 
B)  production demand 
C)  derived demand 
D)  resource demand

Question 9

If the interest rate is 4 percent, the present value of $10,000 to be received one year from today is about

Accepted Answer

A)  $9,246. 
B)  $9,615. 
C)  $10,816. 
D)  $10,400. 
A)  $9,246. 
B)  $9,615. 
C)  $10,816. 
D)  $10,400.

Question 10

What effect does an increase in the price of the firm's output have on its demand curve for labor? Why?

Accepted Answer

An increase in the price of its output s

Question 11

Discuss the difference between renewable and nonrenewable resources. Given an example of each.

Accepted Answer

A renewable natural resource can be used

Question 12

On the supply side of the labor market, the union's success is limited by how much

Accepted Answer

A)  nonunion labor is available in the same market. 
B)  employment union members will accept. 
C)  capital the firm utilizes. 
D)  all of the above 
A)  nonunion labor is available in the same market. 
B)  employment union members will accept. 
C)  capital the firm utilizes. 
D)  all of the above

Question 13

A bilateral monopoly is a

Accepted Answer

A)  firm that is a monopsony in a resource market and a monopoly in a product market. 
B)  firm that is a monopoly in two product markets. 
C)  market in which a monopoly discriminates, setting a higher price for affluent customers. 
D)  market in which a monopsony bargains with a monopoly. 
A)  firm that is a monopsony in a resource market and a monopoly in a product market. 
B)  firm that is a monopoly in two product markets. 
C)  market in which a monopoly discriminates, setting a higher price for affluent customers. 
D)  market in which a monopsony bargains with a monopoly.

Question 14

According to a 1963 edition of the Effingham Daily News, Illinois Consolidated Telephone Co. switched from the switchboard system to the dial system at 12:01 a.m. Sunday, Aug. 18, 1963. Thirty miles of cable supported the new high-tech system. It took four weeks to lay the telephone lines that allowed Effingham residents to directly connect to each other through the telephone. How does the switch from the switchboard system to the dial system impact the labor market for switchboard operators?

Accepted Answer

A)  Increased the demand for telephone operators 
B)  Increased the supply for telephone operators 
C)  Decreased the marginal productivity of telephone operators 
D)  Decreased telephone operators' value of marginal product 
A)  Increased the demand for telephone operators 
B)  Increased the supply for telephone operators 
C)  Decreased the marginal productivity of telephone operators 
D)  Decreased telephone operators' value of marginal product

Question 15

Suppose the price of a car wash falls to $3. The wage rate remains $60 per day.
a) What happens to the marginal product of labor? To the value of marginal product? To Sandy's demand for labor curve?
b) When the price of a car wash falls to $3, how many workers does Sandy employ?

Accepted Answer

@#IMG-DLM& a) The marginal product of labor depend

Question 16

-Hank's Propane Storage Company is a profit-maximizing monopsony in the local labor market for propane handling, delivery, and other associated services. The supply and marginal cost of labor curves are shown in the figure above. Hank's demand for labor curve is the curve labeled VMP = D. What is Hank's total cost of labor at the profit-maximizing quantity of labor employed?

Accepted Answer

A)  $1,200 
B)  $960 
C)  $800 
D)  $600 
A)  $1,200 
B)  $960 
C)  $800 
D)  $600

Question 17

If the interest rate is 10 percent, the present value of a payment of $1,000 one year from today is

Accepted Answer

A)  $900. 
B)  $909. 
C)  $1,000. 
D)  $1,100. 
A)  $900. 
B)  $909. 
C)  $1,000. 
D)  $1,100.

Question 18

-If the labor market in the above figure is competitive, what is the equilibrium wage and quantity of labor hired?

Accepted Answer

A)  $10 and 100 hours 
B)  $10 and 50 hours 
C)  $5 and 100 hours 
D)  $15 and 50 hours 
A)  $10 and 100 hours 
B)  $10 and 50 hours 
C)  $5 and 100 hours 
D)  $15 and 50 hours

Question 19

-City-Mart is the only employer of sales clerks in Panburg. In the figure above S is the labor supply curve faced by City-Mart, VMP is City-Mart's value of marginal product curve, and MCL is its marginal cost of labor curve. The lowest wage rate at which City-Mart can hire 40 hours of labor per day is

Accepted Answer

A)  $8 per hour. 
B)  $12 per hour. 
C)  $4 per hour. 
D)  $9 per hour. 
A)  $8 per hour. 
B)  $12 per hour. 
C)  $4 per hour. 
D)  $9 per hour.

Question 20

A decrease in the wage rate

Accepted Answer

A)  shifts the firm's demand for labor curve rightward. 
B)  shifts the firm's demand for labor curve leftward. 
C)  leads to a movement along the demand for labor curve but does not shift the curve. 
D)  None of the above answers is correct. 
A)  shifts the firm's demand for labor curve rightward. 
B)  shifts the firm's demand for labor curve leftward. 
C)  leads to a movement along the demand for labor curve but does not shift the curve. 
D)  None of the above answers is correct.

If a union can successfully shift the demand curve for union labor rightward, the union can achieve

Starbucks sells coffee in both New York City and in rural upstate New York. The price of coffee is higher in New York City. This fact means that the value of marginal product of land is in New York City and so Starbucks is willing to pay a rent in New York City.

The value of marginal product equals marginal product

The value of marginal product of labor is the ________ when one additional unit of a labor is employed, all other things remaining the same.

-You observe that more labor is employed and the wage rate increases. This set of events could have been the result of a

For a perfectly competitive firm, the value of marginal product diminishes as employment increases because the

The demand for a productive resource, not for its own sake, but for use in the production of goods and services is called a ________.

If the interest rate is 4 percent, the present value of $10,000 to be received one year from today is about

What effect does an increase in the price of the firm's output have on its demand curve for labor? Why?

Discuss the difference between renewable and nonrenewable resources. Given an example of each.

On the supply side of the labor market, the union's success is limited by how much

A bilateral monopoly is a

Suppose the price of a car wash falls to $3. The wage rate remains $60 per day. a) What happens to the marginal product of labor? To the value of marginal product? To Sandy's demand for labor curve? b) When the price of a car wash falls to $3, how many workers does Sandy employ?

If the interest rate is 10 percent, the present value of a payment of $1,000 one year from today is

-If the labor market in the above figure is competitive, what is the equilibrium wage and quantity of labor hired?

A decrease in the wage rate

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

Public Choices, Public Goods, and Healthcare

Externalities

Economic Inequality

Uncertainty and Information

Filters

Exam 18: Markets for Factors of Production

If a union can successfully shift the demand curve for union labor rightward, the union can achieve

Starbucks sells coffee in both New York City and in rural upstate New York. The price of coffee is higher in New York City. This fact means that the value of marginal product of land is ________ in New York City and so Starbucks is willing to pay a ________ rent in New York City.

The value of marginal product equals marginal product

The value of marginal product of labor is the ________ when one additional unit of a labor is employed, all other things remaining the same.

-You observe that more labor is employed and the wage rate increases. This set of events could have been the result of a

For a perfectly competitive firm, the value of marginal product diminishes as employment increases because the

The demand for a productive resource, not for its own sake, but for use in the production of goods and services is called a ________.

If the interest rate is 4 percent, the present value of $10,000 to be received one year from today is about

What effect does an increase in the price of the firm's output have on its demand curve for labor? Why?

Discuss the difference between renewable and nonrenewable resources. Given an example of each.

On the supply side of the labor market, the union's success is limited by how much

A bilateral monopoly is a

Suppose the price of a car wash falls to $3. The wage rate remains $60 per day. a) What happens to the marginal product of labor? To the value of marginal product? To Sandy's demand for labor curve? b) When the price of a car wash falls to $3, how many workers does Sandy employ?

If the interest rate is 10 percent, the present value of a payment of $1,000 one year from today is

-If the labor market in the above figure is competitive, what is the equilibrium wage and quantity of labor hired?

A decrease in the wage rate

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

Public Choices, Public Goods, and Healthcare

Externalities

Economic Inequality

Uncertainty and Information

Filters

Starbucks sells coffee in both New York City and in rural upstate New York. The price of coffee is higher in New York City. This fact means that the value of marginal product of land is in New York City and so Starbucks is willing to pay a rent in New York City.