Question 1

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 2

The marginal product of labor measures:

Accepted Answer

A) the total amount of output produced by all workers combined. 
B) the quantity of an intermediate product that is combined with labor to produce output. 
C) the amount of output an individual worker contributes to a firm's total output. 
D) the average productivity of workers hired by a firm. 
E) none of the above. 
A) the total amount of output produced by all workers combined. 
B) the quantity of an intermediate product that is combined with labor to produce output. 
C) the amount of output an individual worker contributes to a firm's total output. 
D) the average productivity of workers hired by a firm. 
E) none of the above.

Question 3

Exhibit 10-A
Several congressmen and senators have been greatly concerned about the fairness of salaries in the marketplace. They are contemplating enacting a law that would fix the wage rate at WS1U1B1AS1U1B0. Their aides, who were all excellent economics students, have returned with the results of an investigation into the matter, as portrayed below.  
-Refer to Exhibit 10-A.If the wage law was not enacted, the prevailing wage rate and quantity of labor in the marketplace for K-12 teachers at equilibrium would be:

Accepted Answer

A) WB and Q2, respectively. 
B) WA and Q2, respectively. 
C) WA and Q3, respectively. 
D) WB and Q1, respectively. 
E) WA and Q1, respectively. 
A) WB and Q2, respectively. 
B) WA and Q2, respectively. 
C) WA and Q3, respectively. 
D) WB and Q1, respectively. 
E) WA and Q1, respectively.

Question 4

At any moment in time, middle-age people tend to have higher incomes than both younger and older people do.

Accepted Answer

A) True 
 B)False

Question 5

How does age affect the amount of income people earn?

Accepted Answer

Younger people with few skills tend to m

Question 6

The profit-maximizing firm should lay off workers when:

Accepted Answer

A) MRC  MRP. 
C) MRC = MRP. 
D) the MP of labor begins to diminish. 
A) MRC  MRP. 
C) MRC = MRP. 
D) the MP of labor begins to diminish.

Question 7

If an increase occurs in the demand for the output of industry A, we would expect all of the following to happen except:

Accepted Answer

A) an increase in the profits of industry A. 
B) a decrease in prices of inputs used in the production of A. 
C) an increase in the output of industry A. 
D) an increase in the demand for inputs used in the production of A. 
A) an increase in the profits of industry A. 
B) a decrease in prices of inputs used in the production of A. 
C) an increase in the output of industry A. 
D) an increase in the demand for inputs used in the production of A.

Question 8

Which of the following will not contribute to higher wage rates for labor?

Accepted Answer

A) increased unionization and decreased nonunionization of employees in the economy 
B) a rapid increase in the demand for labor 
C) significantly relaxed immigration standards 
D) increases in technological advances 
A) increased unionization and decreased nonunionization of employees in the economy 
B) a rapid increase in the demand for labor 
C) significantly relaxed immigration standards 
D) increases in technological advances

Question 9

The typical 50-year-old male earns approximately ____ as a male in his early 20s.

Accepted Answer

A) twice as much 
B) the same 
C) half as much 
D) 1/3 as much 
A) twice as much 
B) the same 
C) half as much 
D) 1/3 as much

Question 10

As more workers are hired to harvest grapes in a vineyard, the fields become overcrowded.As a result, the marginal product of labor is likely to diminish.

Accepted Answer

A) True 
 B)False

Question 11

Monopolistically competitive sellers are price takers.

Accepted Answer

A) True 
 B)False

Question 12

The official poverty rate for the United States is currently set at ____ times the cost of providing a nutritionally adequate diet.

Accepted Answer

A) two 
B) three 
C) five 
D) eight 
E) ten 
A) two 
B) three 
C) five 
D) eight 
E) ten

Question 13

A worker's contribution to the firm's revenue is measured directly by the worker's:

Accepted Answer

A) value of marginal product. 
B) marginal product multiplied by his/her wage. 
C) marginal product minus his/her wage. 
D) contribution to total output. 
A) value of marginal product. 
B) marginal product multiplied by his/her wage. 
C) marginal product minus his/her wage. 
D) contribution to total output.

Question 14

Differences in income can be accounted for by differences in:

Accepted Answer

A) preferences toward risk. 
B) age. 
C) education. 
D) preferences toward leisure. 
E) all of the above. 
A) preferences toward risk. 
B) age. 
C) education. 
D) preferences toward leisure. 
E) all of the above.

Question 15

The labor ____ curve(s) will shift if there is a change in productivity or a change in the demand for the final product.

Accepted Answer

A) supply 
B) demand 
C) supply and demand 
D) None of the above are correct. Changes in productivity and the demand for final products do not affect the labor market. 
A) supply 
B) demand 
C) supply and demand 
D) None of the above are correct. Changes in productivity and the demand for final products do not affect the labor market.

Question 16

If there were a decreased fraction of divorced couples and an increase in the proportion of two-income families:

Accepted Answer

A) both would tend to increase measured income inequality. 
B) both would tend to decrease measured income inequality. 
C) the decreased fraction of divorced couples would tend to increase measured income inequality, but the increase in the proportion of two-income families would tend to decrease measured income inequality. 
D) the decreased fraction of divorced couples would tend to decrease measured income inequality, but the increase in the proportion of two-income families would tend to increase measured income inequality. 
A) both would tend to increase measured income inequality. 
B) both would tend to decrease measured income inequality. 
C) the decreased fraction of divorced couples would tend to increase measured income inequality, but the increase in the proportion of two-income families would tend to decrease measured income inequality. 
D) the decreased fraction of divorced couples would tend to decrease measured income inequality, but the increase in the proportion of two-income families would tend to increase measured income inequality.

Question 17

Bob's Baubles, Inc., sells its product for $3 each in a perfectly competitive market.If it increases its workforce from 1,000 to 1,001, its output goes from 615 to 625 per day.Its marginal revenue product for the 1,001st worker is:

Accepted Answer

A) $3. 
B) $1, 845. 
C) $30. 
D) $3,003 
A) $3. 
B) $1, 845. 
C) $30. 
D) $3,003

Question 18

The effect of unions tends to ____ output in the union sector and ____ output in the non-union sector.

Accepted Answer

A) increase; increase. 
B) increase; decrease. 
C) decrease; increase. 
D) decrease; decrease. 
A) increase; increase. 
B) increase; decrease. 
C) decrease; increase. 
D) decrease; decrease.

Question 19

The demand curve for labor slopes downward because:

Accepted Answer

A) few workers are willing to work at low wages. 
B) capital has been substituted for labor in most industries. 
C) of the diminishing marginal product of labor. 
D) of all of the above. 
A) few workers are willing to work at low wages. 
B) capital has been substituted for labor in most industries. 
C) of the diminishing marginal product of labor. 
D) of all of the above.

Question 20

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

Accepted Answer

A) True 
 B)False

Demand for inputs is a derived demand because:

The marginal product of labor measures:

At any moment in time, middle-age people tend to have higher incomes than both younger and older people do.

How does age affect the amount of income people earn?

The profit-maximizing firm should lay off workers when:

If an increase occurs in the demand for the output of industry A, we would expect all of the following to happen except:

Which of the following will not contribute to higher wage rates for labor?

The typical 50-year-old male earns approximately ____ as a male in his early 20s.

As more workers are hired to harvest grapes in a vineyard, the fields become overcrowded.As a result, the marginal product of labor is likely to diminish.

Monopolistically competitive sellers are price takers.

The official poverty rate for the United States is currently set at ____ times the cost of providing a nutritionally adequate diet.

A worker's contribution to the firm's revenue is measured directly by the worker's:

Differences in income can be accounted for by differences in:

The labor ____ curve(s) will shift if there is a change in productivity or a change in the demand for the final product.

If there were a decreased fraction of divorced couples and an increase in the proportion of two-income families:

Bob's Baubles, Inc., sells its product for $3 each in a perfectly competitive market.If it increases its workforce from 1,000 to 1,001, its output goes from 615 to 625 per day.Its marginal revenue product for the 1,001^st worker is:

The effect of unions tends to output in the union sector and output in the non-union sector.

The demand curve for labor slopes downward because:

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

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters

Exam 10: Labor Markets, Income Distribution, and Poverty

Demand for inputs is a derived demand because:

The marginal product of labor measures:

At any moment in time, middle-age people tend to have higher incomes than both younger and older people do.

How does age affect the amount of income people earn?

The profit-maximizing firm should lay off workers when:

If an increase occurs in the demand for the output of industry A, we would expect all of the following to happen except:

Which of the following will not contribute to higher wage rates for labor?

The typical 50-year-old male earns approximately ____ as a male in his early 20s.

As more workers are hired to harvest grapes in a vineyard, the fields become overcrowded.As a result, the marginal product of labor is likely to diminish.

Monopolistically competitive sellers are price takers.

The official poverty rate for the United States is currently set at ____ times the cost of providing a nutritionally adequate diet.

A worker's contribution to the firm's revenue is measured directly by the worker's:

Differences in income can be accounted for by differences in:

The labor ____ curve(s) will shift if there is a change in productivity or a change in the demand for the final product.

If there were a decreased fraction of divorced couples and an increase in the proportion of two-income families:

Bob's Baubles, Inc., sells its product for $3 each in a perfectly competitive market.If it increases its workforce from 1,000 to 1,001, its output goes from 615 to 625 per day.Its marginal revenue product for the 1,001st worker is:

The effect of unions tends to ____ output in the union sector and ____ output in the non-union sector.

The demand curve for labor slopes downward because:

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

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters

Bob's Baubles, Inc., sells its product for $3 each in a perfectly competitive market.If it increases its workforce from 1,000 to 1,001, its output goes from 615 to 625 per day.Its marginal revenue product for the 1,001^st worker is:

The effect of unions tends to output in the union sector and output in the non-union sector.