Question 1

Universities are able to act as monopsonists in the market for professors because

Accepted Answer

A)  a university usually does not consider hiring faculty members from another institution. 
B)  faculty members usually have to move to a different city when changing universities. 
C)  students like all of their professors. 
D)  senior faculty members are willing to move to a new university at any cost. 
A)  a university usually does not consider hiring faculty members from another institution. 
B)  faculty members usually have to move to a different city when changing universities. 
C)  students like all of their professors. 
D)  senior faculty members are willing to move to a new university at any cost.

Question 2

Explain why baseball ticket prices may increase when a team pays a new player a large salary,but will remain unchanged when a current player gets a salary increase.

Accepted Answer

The salary increase of a current player

Question 3

A monopsonist faces a constant elasticity of labor supply of 1.5.If the monopsonist pays $15 per hour,its marginal expenditure equals

Accepted Answer

A)  $15. 
B)  $25. 
C)  $7. 
D)  25%. 
A)  $15. 
B)  $25. 
C)  $7. 
D)  25%.

Question 4

If a monopolist in the output market purchases its monopoly supplier of labor,consumers benefit.

Accepted Answer

A) True 
 B)False

Question 5

The steeper the labor supply curve,

Accepted Answer

A)  the higher the wage the monopsonist pays. 
B)  the lower the wage the monopsonist pays. 
C)  the smaller the difference between the wage and the marginal expenditure on labor. 
D)  the better off workers are. 
A)  the higher the wage the monopsonist pays. 
B)  the lower the wage the monopsonist pays. 
C)  the smaller the difference between the wage and the marginal expenditure on labor. 
D)  the better off workers are.

Question 6

For a monopoly,the value of the next worker equals

Accepted Answer

A)  MR ∗ MPL. 
B)  p ∗ MPL. 
C)  MPL. 
D)  w/MPL. 
A)  MR ∗ MPL. 
B)  p ∗ MPL. 
C)  MPL. 
D)  w/MPL.

Question 7

If the supply of labor to a monopsonist is everywhere unit elastic,then the wage will equal

Accepted Answer

A)  the marginal expenditure. 
B)  one-half of the marginal expenditure. 
C)  the marginal revenue product of labor. 
D)  one. 
A)  the marginal expenditure. 
B)  one-half of the marginal expenditure. 
C)  the marginal revenue product of labor. 
D)  one.

Question 8

To derive the labor market demand curve,the labor demand curves for each firm in the output market of interest are summed.

Accepted Answer

A) True 
 B)False

Question 9

XYZ Co.operates in a competitive market.Its marginal product of labor is 1/L,and it takes the wage and price as given.Derive the firm's short-run demand for labor as a function of w and p.How much labor will the firm hire if w = 2 and p = 10?

Accepted Answer

Setting w = p ∗ MPL

Question 10

The demand for a monopoly's output is p = 100 - Q.The firm's production function is Q = 2L.Which of the following is the firm's demand for labor?

Accepted Answer

A)  w = 200 - 8L 
B)  w = 200 - 4L 
C)  w = 100 - L 
D)  w = 2L 
A)  w = 200 - 8L 
B)  w = 200 - 4L 
C)  w = 100 - L 
D)  w = 2L

Question 11

A firm faces competitive markets for its inputs and its output.At the profit maximizing level of output,its marginal cost is $10 and the wage paid is $2.If the MPL = L-0.5,how many workers will be hired by the firm?

Accepted Answer

A)  35 
B)  40 
C)  25 
D)  5 
A)  35 
B)  40 
C)  25 
D)  5

Question 12

Suppose n identical Cournot firms purchase labor in a competitive labor market.How is the market demand for labor affected by the number of firms in the market?

Accepted Answer

Each firm chooses a quantity of labor de

Question 13

Why is the short-run demand curve for labor downward sloping?

Accepted Answer

The firm will pay another unit of labor

Universities are able to act as monopsonists in the market for professors because

Explain why baseball ticket prices may increase when a team pays a new player a large salary,but will remain unchanged when a current player gets a salary increase.

A monopsonist faces a constant elasticity of labor supply of 1.5.If the monopsonist pays $15 per hour,its marginal expenditure equals

If a monopolist in the output market purchases its monopoly supplier of labor,consumers benefit.

The steeper the labor supply curve,

For a monopoly,the value of the next worker equals

If the supply of labor to a monopsonist is everywhere unit elastic,then the wage will equal

To derive the labor market demand curve,the labor demand curves for each firm in the output market of interest are summed.

XYZ Co.operates in a competitive market.Its marginal product of labor is 1/L,and it takes the wage and price as given.Derive the firm's short-run demand for labor as a function of w and p.How much labor will the firm hire if w = 2 and p = 10?

The demand for a monopoly's output is p = 100 - Q.The firm's production function is Q = 2L.Which of the following is the firm's demand for labor?

A firm faces competitive markets for its inputs and its output.At the profit maximizing level of output,its marginal cost is $10 and the wage paid is $2.If the MPL = L^-0.5,how many workers will be hired by the firm?

Suppose n identical Cournot firms purchase labor in a competitive labor market.How is the market demand for labor affected by the number of firms in the market?

Why is the short-run demand curve for labor downward sloping?

Introduction

Supply and Demand

Applying the Supply and Demand Model

Consumer Choice

Applying Consumer Theory

Firms and Production

Costs

Competitive Firms and Markets

Applying the Competitive Model

General Equilibrium and Economic Welfare

Monopoly

Pricing and Advertising

Oligopoly and Monopolistic Competition

Game Theory

Interest Rates, Investments, and Capital Markets

Uncertainty

Externalities, Open-Access, and Public Goods

Asymmetric Information

Contracts and Moral Hazards

Filters

Exam 15: Factor Markets

Universities are able to act as monopsonists in the market for professors because

Explain why baseball ticket prices may increase when a team pays a new player a large salary,but will remain unchanged when a current player gets a salary increase.

A monopsonist faces a constant elasticity of labor supply of 1.5.If the monopsonist pays $15 per hour,its marginal expenditure equals

If a monopolist in the output market purchases its monopoly supplier of labor,consumers benefit.

The steeper the labor supply curve,

For a monopoly,the value of the next worker equals

If the supply of labor to a monopsonist is everywhere unit elastic,then the wage will equal

To derive the labor market demand curve,the labor demand curves for each firm in the output market of interest are summed.

XYZ Co.operates in a competitive market.Its marginal product of labor is 1/L,and it takes the wage and price as given.Derive the firm's short-run demand for labor as a function of w and p.How much labor will the firm hire if w = 2 and p = 10?

The demand for a monopoly's output is p = 100 - Q.The firm's production function is Q = 2L.Which of the following is the firm's demand for labor?

A firm faces competitive markets for its inputs and its output.At the profit maximizing level of output,its marginal cost is $10 and the wage paid is $2.If the MPL = L-0.5,how many workers will be hired by the firm?

Suppose n identical Cournot firms purchase labor in a competitive labor market.How is the market demand for labor affected by the number of firms in the market?

Why is the short-run demand curve for labor downward sloping?

Introduction

Supply and Demand

Applying the Supply and Demand Model

Consumer Choice

Applying Consumer Theory

Firms and Production

Costs

Competitive Firms and Markets

Applying the Competitive Model

General Equilibrium and Economic Welfare

Monopoly

Pricing and Advertising

Oligopoly and Monopolistic Competition

Game Theory

Interest Rates, Investments, and Capital Markets

Uncertainty

Externalities, Open-Access, and Public Goods

Asymmetric Information

Contracts and Moral Hazards

Filters

A firm faces competitive markets for its inputs and its output.At the profit maximizing level of output,its marginal cost is $10 and the wage paid is $2.If the MPL = L^-0.5,how many workers will be hired by the firm?