Exam 12: The Factors of Production

Below is a graphical illustration of Nearly Done Inc.'s marginal revenue product.The firm employs its labour in a perfectly competitive labour market. -Refer to the above information to answer this question.What quantity of labour is Nearly Done Inc.employing when the marginal product of labour is maximized?

Table 12.3,which is data for the firm Skipper the Shoe Maker. Table 12.3 -Use Table 12.3 to answer this question.If labour can be hired for $28 an hour,how many hours should the firm hire?

Distinguish between the real wage and the nominal wage.

-Economic research has established that individuals with more formal education enjoy,on average,higher earnings throughout their lives.Approximately how much higher is the annual income of those with a post-secondary education compared with those who have elementary school education only?

Given the following data and assuming the product can be sold for $3 per unit,fill in Table 12.1. Table 12.1

What is meant by the factor output effect?

Describe three ways in which a union might be able to increase the wage rate received by its members.

Use the theory of marginal productivity and the concept of the real wage to discuss whether you think Robinson Crusoe's standard of living increased or decreased as a result of Friday coming onto the scene.

-Refer to the information above to answer this question.What is the firm's total revenue if it maximizes its profits?

Heavenly Bubbles is a small soap company whose main product is hand soap,which sells in a competitive market for $3 a bar.The output per hour of each workstation varies with the amount of labour used as the data in the table below indicates.Labour costs $12 and hour a)Fill in the marginal product,total revenue I and marginal revenue I columns in the table above. b)How many workers would the firm assign to each workstation? c)Now assume that the wage rate increases to $16 an hour.How many workers should the firm now assign to each workstation? d)Suppose the price of each bar increases to $4 each.Fill in the total revenue II column and marginal revenue product II in the table above to reflect this change. e)Now how many workers would the firm assign to each workstation at a wage rate of $16?

Why is the normal shape of the labour supply curve upward sloping?

The average wage rate in Canada has increased over the last 30 years.Which of the following is the most likely explanation?

If most people's desire for leisure increases,which one of the following statements is correct?

Which of the following is correct regarding the demand curve for labour?

Refer to the graph above to answer this question.Suppose that the demand for land is D³ and the market is in equilibrium.What is the equilibrium rent?

The first 3 columns of the following table show data for a representative firm in an industry.The last 3 columns show the market demand and supply for the type of labour employed by this firm. -What will be the effect if an economy experiences growth in its labour productivity over a period of years?

The first 3 columns of the following table show data for a representative firm in an industry.The last 3 columns show the market demand and supply for the type of labour employed by this firm. -What happens if the demand for labour increases more than does the supply of labour?

Differentiate between economic rent and transfer earnings.

If the product market is imperfectly competitive rather than perfectly competitive,the marginal revenue product curve declines faster.

-Refer to the information above to answer this question.What is the firm's total profit if its fixed cost are $180,labour is its only variable costs and it maximizes its profits?