Question 1

Which of the following would certainly increase the demand for labor?

Accepted Answer

A)  an increase in demand for the final product and an increase in the productivity of labor 
B)  an increase in demand for the final product and a decrease in the productivity of labor 
C)  a decrease in demand for the final product and an increase in the productivity of labor 
D)  a decrease in demand for the final product and a decrease in the productivity of labor 
A)  an increase in demand for the final product and an increase in the productivity of labor 
B)  an increase in demand for the final product and a decrease in the productivity of labor 
C)  a decrease in demand for the final product and an increase in the productivity of labor 
D)  a decrease in demand for the final product and a decrease in the productivity of labor

Question 2

Where monopsony exists,____ workers will be hired at ____ wages than if perfect competition prevailed in a labor market.

Accepted Answer

A)  fewer; lower 
B)  fewer; higher 
C)  more; lower 
D)  more: higher 
A)  fewer; lower 
B)  fewer; higher 
C)  more; lower 
D)  more: higher

Question 3

Demand for inputs is a derived demand because:

Accepted Answer

A)  it is derived from the need for income. 
B)  it corresponds to the derived supply of the inputs. 
C)  the demand for output leads producers to demand inputs used to produce finished goods. 
D)  of the diminishing marginal product of inputs. 
A)  it is derived from the need for income. 
B)  it corresponds to the derived supply of the inputs. 
C)  the demand for output leads producers to demand inputs used to produce finished goods. 
D)  of the diminishing marginal product of inputs.

Question 4

Would the owner of a profit-maximizing fast-food establishment hire another worker for $55 per day if that worker added faster service,increasing sales and revenue by $50 per day? Why or why not?

Accepted Answer

No,hiring this employee would

Question 5

The demand for cake decorators has no relationship to the demand for cakes.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following would not shift the demand for resource Z?

Accepted Answer

A)  A decline in the price of resource Z. 
B)  A decline in the price of substitute resource A. 
C)  An increase in the productivity of resource Z. 
D)  An increase in the price of the product resource Z is used to produce. 
A)  A decline in the price of resource Z. 
B)  A decline in the price of substitute resource A. 
C)  An increase in the productivity of resource Z. 
D)  An increase in the price of the product resource Z is used to produce.

Question 7

How does monopsony power evolve? What factors might aid its continued presence?

Accepted Answer

Monopsony may arise because a person wit

Question 8

When wages decrease

Accepted Answer

A)  the substitution effect increases the quantity of labor supplied 
B)  the substitution effect increases the supply of labor. 
C)  the income effect increases the quantity of labor supplied 
D)  the income effect increases the supply of labor. 
A)  the substitution effect increases the quantity of labor supplied 
B)  the substitution effect increases the supply of labor. 
C)  the income effect increases the quantity of labor supplied 
D)  the income effect increases the supply of labor.

Question 9

Which of the following might shift an individual's supply curve of labor to the left?

Accepted Answer

A)  winning the lottery 
B)  a decrease in non-wage income 
C)  due to falling sales, businesses are less willing to hire additional workers 
D)  a decrease in derived demand 
A)  winning the lottery 
B)  a decrease in non-wage income 
C)  due to falling sales, businesses are less willing to hire additional workers 
D)  a decrease in derived demand

Question 10

A decrease in the price of a firm's output will shift the firm's demand curve for labor to the right,other things being equal.

Accepted Answer

A) True 
 B)False

Question 11

Exhibit 16-2 The following lists possible capital investments that a business might pursue.
  Refer to Exhibit 16-2.How many projects would the firm invest in if the interest rate is 7 percent?

Accepted Answer

A)  0 
B)  1 
C)  2 
D)  3 
A)  0 
B)  1 
C)  2 
D)  3

Question 12

The relationship between the wage rate and the quantity of labor that workers wish to supply in total is called:

Accepted Answer

A)  the market supply curve for labor. 
B)  the market demand curve for labor. 
C)  an individual demand curve for labor. 
D)  an individual supply curve for labor. 
A)  the market supply curve for labor. 
B)  the market demand curve for labor. 
C)  an individual demand curve for labor. 
D)  an individual supply curve for labor.

Question 13

Exhibit 16-3   Refer to Exhibit 16-3.Which of the following situations is relevant to Case A?

Accepted Answer

A)  Deteriorating job conditions 
B)  A decrease in nonwage income 
C)  People become willing to work fewer hours at a given wage 
D)  Workers leaving the labor force 
A)  Deteriorating job conditions 
B)  A decrease in nonwage income 
C)  People become willing to work fewer hours at a given wage 
D)  Workers leaving the labor force

Question 14

The demand curve for capital is ____ and its supply curve is ____.

Accepted Answer

A)  downward sloping; downward sloping 
B)  upward sloping; upward sloping 
C)  downward sloping; upward sloping; 
D)  upward sloping; downward sloping 
A)  downward sloping; downward sloping 
B)  upward sloping; upward sloping 
C)  downward sloping; upward sloping; 
D)  upward sloping; downward sloping

Question 15

Unionization provides ____ in given occupations,and as a result,wage rates in these occupations have a tendency to ____.

Accepted Answer

A)  barriers to entry; decrease 
B)  barriers to entry; increase 
C)  ease of entry; decrease 
D)  ease of entry; increase 
A)  barriers to entry; decrease 
B)  barriers to entry; increase 
C)  ease of entry; decrease 
D)  ease of entry; increase

Question 16

If there is an increase in demand for a good,

Accepted Answer

A)  there will be an increase in demand for the inputs that produce it. 
B)  there will be a decrease in demand for the inputs that produce it. 
C)  there will be an increase in supply of the inputs that produce it. 
D)  there will be a decrease in supply of the inputs that produce it. 
A)  there will be an increase in demand for the inputs that produce it. 
B)  there will be a decrease in demand for the inputs that produce it. 
C)  there will be an increase in supply of the inputs that produce it. 
D)  there will be a decrease in supply of the inputs that produce it.

Question 17

All of the following are characteristics of a monopsony employer except:

Accepted Answer

A)  there is a single buyer of labor. 
B)  the monopsony firm moves up the positively sloped supply curve it faces. 
C)  fewer number of workers hired for wages below what they would be in a competitive market. 
D)  workers work for less than their marginal revenue product. 
A)  there is a single buyer of labor. 
B)  the monopsony firm moves up the positively sloped supply curve it faces. 
C)  fewer number of workers hired for wages below what they would be in a competitive market. 
D)  workers work for less than their marginal revenue product.

Question 18

Which of the following does not contribute to increased worker productivity?

Accepted Answer

A)  technological advances 
B)  increased capital formation 
C)  improvements in workers' skills 
D)  increased labor supply 
A)  technological advances 
B)  increased capital formation 
C)  improvements in workers' skills 
D)  increased labor supply

Question 19

An increase in the interest rate will:

Accepted Answer

A)  increase the amount of money borrowed by firms. 
B)  decrease the amount of money borrowed by firms. 
C)  have an ambiguous effect on the amount of money borrowed by firms. 
D)  have no effect on the amount of money borrowed by firms. 
A)  increase the amount of money borrowed by firms. 
B)  decrease the amount of money borrowed by firms. 
C)  have an ambiguous effect on the amount of money borrowed by firms. 
D)  have no effect on the amount of money borrowed by firms.

Question 20

The MRP curve for labor

Accepted Answer

A)  is the same as the demand curve for labor for a competitive firm. 
B)  is the same as the supply curve for labor to a competitive firm. 
C)  will shift up when market wages rise. 
D)  is characterized by both (a) and (b). 
A)  is the same as the demand curve for labor for a competitive firm. 
B)  is the same as the supply curve for labor to a competitive firm. 
C)  will shift up when market wages rise. 
D)  is characterized by both (a) and (b).

Exam 16: The Markets for Labor, Capital, and Land

Which of the following would certainly increase the demand for labor?

Where monopsony exists,____ workers will be hired at ____ wages than if perfect competition prevailed in a labor market.

Demand for inputs is a derived demand because:

Would the owner of a profit-maximizing fast-food establishment hire another worker for $55 per day if that worker added faster service,increasing sales and revenue by $50 per day? Why or why not?

The demand for cake decorators has no relationship to the demand for cakes.

Which of the following would not shift the demand for resource Z?

How does monopsony power evolve? What factors might aid its continued presence?

When wages decrease

Which of the following might shift an individual's supply curve of labor to the left?

A decrease in the price of a firm's output will shift the firm's demand curve for labor to the right,other things being equal.

Exhibit 16-2 The following lists possible capital investments that a business might pursue. Refer to Exhibit 16-2.How many projects would the firm invest in if the interest rate is 7 percent?

The relationship between the wage rate and the quantity of labor that workers wish to supply in total is called:

Exhibit 16-3 Refer to Exhibit 16-3.Which of the following situations is relevant to Case A?

The demand curve for capital is ____ and its supply curve is ____.

Unionization provides ____ in given occupations,and as a result,wage rates in these occupations have a tendency to ____.

If there is an increase in demand for a good,

All of the following are characteristics of a monopsony employer except:

Which of the following does not contribute to increased worker productivity?

An increase in the interest rate will:

The MRP curve for labor

The Role and Method of Economics

Economics: Eight Powerful Ideas

Scarcity, Trade-Offs, and Production Possibilities

Demand, Supply, and Market Equilibrium

Markets in Motion and Price Controls

Elasticities

Market Efficiency and Welfare

Market Failure

Public Finance and Public Choice

Consumer Choice Theory

The Firm: Production and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust

Monopolistic Competition and Product Differentiation

Oligopoly and Strategic Behavior

Income, Poverty, and Health Care

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Measuring Economic Performance

Economic Growth in the Global Economy

Financial Markets, Saving, and Investment

Aggregate Demand and Aggregate Supply

The Aggregate Expenditure Model

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Trade

International Finance

Filters

Where monopsony exists, workers will be hired at wages than if perfect competition prevailed in a labor market.

The demand curve for capital is and its supply curve is .

Unionization provides in given occupations,and as a result,wage rates in these occupations have a tendency to .