Exam 10: Labor Markets, Income Distribution, and Poverty

With a negative income tax featuring an $8,000 minimum level of income and a 20% tax rate, a household earning $8,000 dollars would receive a subsidy of:

Cooperation between the two prisoners in the "Prisoners' Dilemma" game is difficult to maintain because cooperation is individually irrational.

The intersection of the market demand for labor and the market supply for labor determines the equilibrium wage rate.

Which of the following statements are true regarding profit-maximizing firms?

Although there are certain inefficiencies associated with monopolistic competition, society receives a benefit from monopolistic competition in the form of product variety.

Many economists conclude that in-kind income programs have served to reduce levels of inequality significantly from the levels suggested by aggregate income statistics.

The demand for labor is derived from the demand for final goods which that labor is used to produce.

Which of the following represents in-kind income?

The demand curve faced by an oligopolistic producer depends on how rival firms react to its prices and policies.

Cartels are legal in many countries, including the United States.

Increases in income from other sources than employment can cause the labor ____ curve to shift ____.

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

Which of the following countries has the greatest degree of income inequality?

In the United States the degree of individual income mobility (that is, the degree to which people move from higher to lower, or lower to higher, income groupings) is:

Which of the following is a reason that income inequality might be overstated?

Police officers earn higher wages because of the dangers associated with their profession.

A group of firms, operating in collusion, incur costs of production of $15 per unit.The price that currently maximizes their profit is $19.Knowing that potential competitors could enter the market with production costs of $17 per unit, what price are the colluders likely to charge? Why?

Since 1935, the proportion of income received by the top 5 percent of Americans has:

Mr.Calhoun owned land on which cotton could be grown, but which he had been unable to rent for years.Suddenly he was getting offers from cotton farmers to lease his land.Which of the following best explains this change in circumstances?

If labor is the only variable input, an additional worker increases output from 72 to 78 units, and the product price is $6, the marginal revenue product from an additional worker: