Exam 28: The Labor Market: Demand, Supply and Outsourcing

The following table depicts both the product and labor markets for imported coffee. What is the total revenue when 15 workers per day are hired?

A firm that maximizes profits also

Suppose there are four industries. Labor costs are 20 percent of total costs in A, 40 percent in B, 60 percent in C, and 80 percent in D. A ten percent increase in the price of labor will cause industry ________ to reduce quantity demanded of labor by the largest proportion.

A single firm in a competitive labor market has a labor supply curve that is

Suppose the market for autoworkers is initially in equilibrium, but then suppose the automakers improve working conditions at the plants. What happens in the market for autoworkers?

We would expect unions to have a more difficult time negotiating higher wages for their members when

-Refer to the above table. Suppose the firm hires 4 workers and the price of the good sold is $4. The marginal factor cost of labor must be

Profit-maximizing employment is the quantity of labor at which

Suppose firms in an industry hire unskilled labor and skilled labor. Unskilled labor is a substitute for capital and skilled labor is a complement with capital. A decrease in the real price of capital would

-Refer to the above table. Suppose the price of the good sold is $4 and the marginal factor cost of labor is $600, how many units of labor will the firm hire?

The wage rate found by the intersection of the market demand and supply curves for labor then determines the

When a firm has maximized profits,

The demand for DVD's increases. As a result,

There are a number of reasons why labor supply curves will shift in a particular industry. Which one of the following is NOT one of them?

Explain the efficiency wage theory.

-Refer to the above figure. represents

The price elasticity of demand for labor equals

For a firm that uses land, labor and capital as inputs, how should the inputs be utilized in order to minimize total costs?

Ajax has just discovered that the marginal revenue product generated by the last worker hired was $125 while the marginal factor cost was $85. What should Ajax do?

The price elasticity of demand for labor will be greater, the