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

An industry utilizes capital and two types of labor. Unskilled labor is a substitute for capital while the skilled labor is complementary to capital. An increase in the price of capital will

A firm's marginal factor cost describes

If a firm hires 312 workers it will produce 4,522 units of output. If it hires 313 workers it will produce 4,786 units of output. The marginal physical product of labor equals

In a perfectly competitive industry, an individual firm faces

Suppose at the current level of labor used, MRP = $100 and MFC = $100. To maximize profits, the firm should

If labor is 80 percent of total costs in industry A and 20 percent in industry B, then other things equal, we would expect the elasticity of demand for labor to be

A profit-maximizing firm will hire additional units of labor until

When the price of a product increases, the marginal revenue product curve in a perfectly competitive market

-In the above figure, the marginal revenue product is represented by line

Suppose that in a computer factory, if there is 1 worker, 80 computers are produced per week. If there are 2 workers, 150 computers are produced per week. If there are 3 workers, 210 computers are produced per week. Given this information, there

If a firm sells its product in a monopolistic market, even though the firm operates in a perfectly competitive labor market, the firm will employ workers up to the point where

-Refer to the above table. If the price of the product is $1.50, what is the marginal revenue product of the 12th worker?

Suppose at the current level of labor used, MRP = $100 and MFC = $50. To maximize profits, the firm should

We assume that when a firm hires additional workers, the marginal physical product of labor will

When there is an increase in the wages the banking industry offers accountants, what happens to the supply of accountants available to other industries?

For a worker to be potentially available, he or she must

If the price elasticity of demand is less than 1, then then consumer demand is

The elasticity of demand for labor will be less the

What is marginal factor cost? How is it related to the supply curve of an input?

As more workers are hired, the marginal physical product of labor eventually declines because