Question 1

Which of the following is true?

Accepted Answer

A)  The value to a firm of hiring another worker is the worker's value of marginal product. 
B)  A firm will hire more workers if the wage rate is greater than the value of marginal product. 
C)  The value of marginal product is the cost of hiring a worker. 
D)  The value of marginal product increases as more workers are hired. 
E)  The value of marginal product equals the price of the good produced divided by the marginal product. 
A)  The value to a firm of hiring another worker is the worker's value of marginal product. 
B)  A firm will hire more workers if the wage rate is greater than the value of marginal product. 
C)  The value of marginal product is the cost of hiring a worker. 
D)  The value of marginal product increases as more workers are hired. 
E)  The value of marginal product equals the price of the good produced divided by the marginal product.

Question 2

-The table shows information for Jen's Gymnastics.Jen's hires coaches and can charge $20 per hour for gymnastics.If the demand for Jen's Gymnastics coaching services increases and the price for coaching increases,Jen

Accepted Answer

A)  will hire more coaches because the value of marginal product has increased. 
B)  will hire fewer coaches because the higher price will decrease the number of gymnasts trained. 
C)  will hire fewer coaches in order to make a higher profit. 
D)  will hire more coaches because there will be movement up along the demand for labor curve. 
E)  may hire more or fewer coaches depending on how the higher price of lessons affects the business. 
A)  will hire more coaches because the value of marginal product has increased. 
B)  will hire fewer coaches because the higher price will decrease the number of gymnasts trained. 
C)  will hire fewer coaches in order to make a higher profit. 
D)  will hire more coaches because there will be movement up along the demand for labor curve. 
E)  may hire more or fewer coaches depending on how the higher price of lessons affects the business.

Question 3

-Refer to the figures above to answer this question.Figure B represents the market for ________ because ________,all else held the same.

Accepted Answer

A)  land; landowners respond to higher rental rates by making more land available 
B)  a nonrenewable resource; as the interest rate increases, less of the resource is supplied 
C)  capital; the Hotelling Principle predicts that prices will vary inversely with the interest rate 
D)  land; the Hotelling Principle states rental rates will increase predictably over time 
E)  capital; as the rental rate increases, the quantity of capital supplied increases and the quantity of capital supplied decreases 
A)  land; landowners respond to higher rental rates by making more land available 
B)  a nonrenewable resource; as the interest rate increases, less of the resource is supplied 
C)  capital; the Hotelling Principle predicts that prices will vary inversely with the interest rate 
D)  land; the Hotelling Principle states rental rates will increase predictably over time 
E)  capital; as the rental rate increases, the quantity of capital supplied increases and the quantity of capital supplied decreases

Question 4

-Kevin owns a personal training gym in Laredo,Texas.He charges $41 per session.The above table shows the marginal product of trainers in Kevin's gym.If Kevin hires three trainers,the value of marginal product of the third trainer equals

Accepted Answer

A)  2 clients. 
B)  $82. 
C)  9 clients. 
D)  $369. 
E)  $123. 
A)  2 clients. 
B)  $82. 
C)  9 clients. 
D)  $369. 
E)  $123.

Question 5

What is the value of marginal product of labor? What is the formula that can be used to calculate? How does the value of the marginal product affect how much labor a firm hires?

Accepted Answer

The value of marginal product of labor i

Question 6

-The table shows information for Jen's Gymnastics.Jen hires coaches and can charge $20 per hour for gymnastics lessons.Jen's Gym pays coaches $30 per hour.The table shows that Jen's Gym will hire ________ coaches because ________.

Accepted Answer

A)  any number less than 5; the marginal product stops increasing with the fifth coach 
B)  4; the gym will earn a profit because the value of marginal profit exceeds the wage rate., but hiring a fifth coach will reduce profit 
C)  1; the value of marginal product is the highest 
D)  5; the marginal product is at its maximum 
E)  5; total product reaches its maximum 
A)  any number less than 5; the marginal product stops increasing with the fifth coach 
B)  4; the gym will earn a profit because the value of marginal profit exceeds the wage rate., but hiring a fifth coach will reduce profit 
C)  1; the value of marginal product is the highest 
D)  5; the marginal product is at its maximum 
E)  5; total product reaches its maximum

Question 7

Which of the following represents a derived demand? Demand for

Accepted Answer

A)  a taco by Sam when she is hungry. 
B)  golf balls by Jose, who is planning on going golfing with his boss. 
C)  a grocery clerk by the local Safeway. 
D)  an automobile by Jack, who wants a car to get to school. 
E)  new clothing by Shaniq, who is starting a new job. 
A)  a taco by Sam when she is hungry. 
B)  golf balls by Jose, who is planning on going golfing with his boss. 
C)  a grocery clerk by the local Safeway. 
D)  an automobile by Jack, who wants a car to get to school. 
E)  new clothing by Shaniq, who is starting a new job.

Question 8

If a firm finds itself at the point where the value of marginal product of labor is greater than its wage rate,then the firm

Accepted Answer

A)  stops hiring more workers but does not fire any because the firm is maximizing its profit. 
B)  decreases the number of workers it has hired in order to increase its profit. 
C)  increases the number of workers it hires in order to increase its profit. 
D)  increases sales to keep its employees busy. 
E)  changes its employment of workers and maximizes its profit by hiring the number of workers that makes the difference between the value of the marginal product and the wage rate as large as possible. 
A)  stops hiring more workers but does not fire any because the firm is maximizing its profit. 
B)  decreases the number of workers it has hired in order to increase its profit. 
C)  increases the number of workers it hires in order to increase its profit. 
D)  increases sales to keep its employees busy. 
E)  changes its employment of workers and maximizes its profit by hiring the number of workers that makes the difference between the value of the marginal product and the wage rate as large as possible.

Question 9

-Peyton is a personal trainer and works at several gyms in her neighborhood.Peyton's labor supply curve is shown above.Which of the following statements is true regarding Peyton's labor supply?
i.Peyton is willing to supply more labor and give up leisure at wages between $50 and $75 per hour.
ii.Peyton will not work for less than $30 per hour.
iii.If the wage increases higher than $75 per hour,Peyton will choose to take more leisure.

Accepted Answer

A)  i, ii and iii. 
B)  ii only. 
C)  iii only. 
D)  i and ii. 
E)  ii and iii. 
A)  i, ii and iii. 
B)  ii only. 
C)  iii only. 
D)  i and ii. 
E)  ii and iii.

Question 10

The demand for labor is derived from the

Accepted Answer

A)  supply of labor. 
B)  wage rate. 
C)  supply of the good the labor is used to produce. 
D)  demand for the goods and services the labor helps produce. 
E)  supply of all the other factors of production that can be substituted for labor. 
A)  supply of labor. 
B)  wage rate. 
C)  supply of the good the labor is used to produce. 
D)  demand for the goods and services the labor helps produce. 
E)  supply of all the other factors of production that can be substituted for labor.

Question 11

According to a recent prediction in The Wall Street Journal the adult population of Russia will decline dramatically over the next few decades.If this prediction is correct,the supply of labor in Russia will

Accepted Answer

A)  increase. 
B)  not change. 
C)  decrease. 
D)  become less elastic. 
E)  become more elastic. 
A)  increase. 
B)  not change. 
C)  decrease. 
D)  become less elastic. 
E)  become more elastic.

Question 12

Explain why an individual's labor supply curve is backward bending.

Accepted Answer

An individual's labor supply curve bends

Question 13

Oil is an example of

Accepted Answer

A)  a nonrenewable natural resource. 
B)  a renewable natural resource. 
C)  physical capital. 
D)  a resource for which the true value cannot be measured. 
E)  a resource with a perfectly inelastic demand. 
A)  a nonrenewable natural resource. 
B)  a renewable natural resource. 
C)  physical capital. 
D)  a resource for which the true value cannot be measured. 
E)  a resource with a perfectly inelastic demand.

Question 14

Because leisure time has value to many workers,as wages increase,the labor supply curve

Accepted Answer

A)  has a positive slope. 
B)  bends backwards and has a negative slope. 
C)  becomes a horizontal line. 
D)  becomes a vertical line. 
E)  bends forward and has a positive slope. 
A)  has a positive slope. 
B)  bends backwards and has a negative slope. 
C)  becomes a horizontal line. 
D)  becomes a vertical line. 
E)  bends forward and has a positive slope.

Question 15

"The decision to employ an additional unit of labor depends on whether the value of marginal product of labor is greater than or less than the wage rate." Is the previous statement correct or incorrect?

Accepted Answer

The statement is correct.If the value of

Question 16

As the quantity of land used increases,its value of marginal product

Accepted Answer

A)  decreases and then eventually increases. 
B)  increases and then eventually decreases. 
C)  remains constant. 
D)  might increase, decrease, or remain constant depending if the rent for the land rises, falls, or does not change. 
E)  The premise of the question is wrong because land does not have a value of marginal product. 
A)  decreases and then eventually increases. 
B)  increases and then eventually decreases. 
C)  remains constant. 
D)  might increase, decrease, or remain constant depending if the rent for the land rises, falls, or does not change. 
E)  The premise of the question is wrong because land does not have a value of marginal product.

Question 17

The table has the marginal products for workers at Bart's Bats, a baseball bat factory.
-Using the above table,if the price of a bat is $8,then the value of marginal product of labor of the fourth worker is

Accepted Answer

A)  $40. 
B)  $0.625. 
C)  $1.375. 
D)  5 bats. 
E)  None of the above answers is correct. 
A)  $40. 
B)  $0.625. 
C)  $1.375. 
D)  5 bats. 
E)  None of the above answers is correct.

Question 18

-The figure above shows the market supply of labor curve.Which of the following might be the reason the labor supply curve shifted from S? to S??

Accepted Answer

A)  an increase in technology 
B)  a decrease in technology 
C)  an increase in the number of women in the work force 
D)  a decrease in the adult population 
E)  an increase in the wage rate 
A)  an increase in technology 
B)  a decrease in technology 
C)  an increase in the number of women in the work force 
D)  a decrease in the adult population 
E)  an increase in the wage rate

Question 19

Derived demand means that the demand for a factor of production is derived from the

Accepted Answer

A)  supply of that factor of production. 
B)  price of that factor of production. 
C)  demand for the goods and services the factor of production is used to produce. 
D)  costs of production. 
E)  government, which forces large firms to hire at least some minimum number of different resources. 
A)  supply of that factor of production. 
B)  price of that factor of production. 
C)  demand for the goods and services the factor of production is used to produce. 
D)  costs of production. 
E)  government, which forces large firms to hire at least some minimum number of different resources.

Question 20

If the price of a firm's product falls,the firm's demand for labor curve

Accepted Answer

A)  does not shift and there is no movement along it. 
B)  shifts leftward. 
C)  shifts rightward. 
D)  does not shift but there is a movement along it. 
E)  might shift leftward or rightward depending on whether the demand for the firm's product is elastic or inelastic. 
A)  does not shift and there is no movement along it. 
B)  shifts leftward. 
C)  shifts rightward. 
D)  does not shift but there is a movement along it. 
E)  might shift leftward or rightward depending on whether the demand for the firm's product is elastic or inelastic.

Which of the following is true?

-The table shows information for Jen's Gymnastics.Jen's hires coaches and can charge $20 per hour for gymnastics.If the demand for Jen's Gymnastics coaching services increases and the price for coaching increases,Jen

-Refer to the figures above to answer this question.Figure B represents the market for because ,all else held the same.

-Kevin owns a personal training gym in Laredo,Texas.He charges $41 per session.The above table shows the marginal product of trainers in Kevin's gym.If Kevin hires three trainers,the value of marginal product of the third trainer equals

What is the value of marginal product of labor? What is the formula that can be used to calculate? How does the value of the marginal product affect how much labor a firm hires?

-The table shows information for Jen's Gymnastics.Jen hires coaches and can charge $20 per hour for gymnastics lessons.Jen's Gym pays coaches $30 per hour.The table shows that Jen's Gym will hire coaches because .

Which of the following represents a derived demand? Demand for

If a firm finds itself at the point where the value of marginal product of labor is greater than its wage rate,then the firm

The demand for labor is derived from the

According to a recent prediction in The Wall Street Journal the adult population of Russia will decline dramatically over the next few decades.If this prediction is correct,the supply of labor in Russia will

Explain why an individual's labor supply curve is backward bending.

Oil is an example of

Because leisure time has value to many workers,as wages increase,the labor supply curve

"The decision to employ an additional unit of labor depends on whether the value of marginal product of labor is greater than or less than the wage rate." Is the previous statement correct or incorrect?

As the quantity of land used increases,its value of marginal product

The table has the marginal products for workers at Bart's Bats, a baseball bat factory. -Using the above table,if the price of a bat is $8,then the value of marginal product of labor of the fourth worker is

-The figure above shows the market supply of labor curve.Which of the following might be the reason the labor supply curve shifted from S? to S??

Derived demand means that the demand for a factor of production is derived from the

If the price of a firm's product falls,the firm's demand for labor curve

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Economic Inequality

Filters

Exam 19: Markets for Factors of Production

Which of the following is true?

-The table shows information for Jen's Gymnastics.Jen's hires coaches and can charge $20 per hour for gymnastics.If the demand for Jen's Gymnastics coaching services increases and the price for coaching increases,Jen

-Refer to the figures above to answer this question.Figure B represents the market for ________ because ________,all else held the same.

-Kevin owns a personal training gym in Laredo,Texas.He charges $41 per session.The above table shows the marginal product of trainers in Kevin's gym.If Kevin hires three trainers,the value of marginal product of the third trainer equals

What is the value of marginal product of labor? What is the formula that can be used to calculate? How does the value of the marginal product affect how much labor a firm hires?

-The table shows information for Jen's Gymnastics.Jen hires coaches and can charge $20 per hour for gymnastics lessons.Jen's Gym pays coaches $30 per hour.The table shows that Jen's Gym will hire ________ coaches because ________.

Which of the following represents a derived demand? Demand for

If a firm finds itself at the point where the value of marginal product of labor is greater than its wage rate,then the firm

The demand for labor is derived from the

According to a recent prediction in The Wall Street Journal the adult population of Russia will decline dramatically over the next few decades.If this prediction is correct,the supply of labor in Russia will

Explain why an individual's labor supply curve is backward bending.

Oil is an example of

Because leisure time has value to many workers,as wages increase,the labor supply curve

"The decision to employ an additional unit of labor depends on whether the value of marginal product of labor is greater than or less than the wage rate." Is the previous statement correct or incorrect?

As the quantity of land used increases,its value of marginal product

The table has the marginal products for workers at Bart's Bats, a baseball bat factory. -Using the above table,if the price of a bat is $8,then the value of marginal product of labor of the fourth worker is

-The figure above shows the market supply of labor curve.Which of the following might be the reason the labor supply curve shifted from S? to S??

Derived demand means that the demand for a factor of production is derived from the

If the price of a firm's product falls,the firm's demand for labor curve

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Economic Inequality

Filters

-Refer to the figures above to answer this question.Figure B represents the market for because ,all else held the same.

-The table shows information for Jen's Gymnastics.Jen hires coaches and can charge $20 per hour for gymnastics lessons.Jen's Gym pays coaches $30 per hour.The table shows that Jen's Gym will hire coaches because .