Question 1

When a competitive firm hires labor up to the point at which the value of the marginal product of labor equals the wage, it also produces output up to the point at which marginal cost is equal to __________.

Accepted Answer

The answer of When a competitive firm hires labor up...

Question 2

Figure 18-11 
-Refer to Figure 18-11. What is measured on the vertical axis of the graph?

Accepted Answer

A) the rate of technological progress 
B) wages paid to workers in markets where capital goods are produced 
C) wages paid to workers in markets where capital goods are not produced 
D) the rental price of capital

Question 3

In the United States, technological advances help explain persistently rising employment in the face of rising wages.

Accepted Answer

A) True 
 B)False

Question 4

Suppose that the labor market for high school chemistry teachers is initially in equilibrium. Chemistry teachers use laboratory chemicals as an important part of their jobs. New environmental regulations ban the use of many chemicals, which means that fewer laboratory chemicals are available for high school chemistry teachers to use in their jobs. In the market for high school chemistry teachers, the equilibrium wage

Accepted Answer

A) increases because the marginal productivity of high school chemistry teachers increases. 
B) decreases because the marginal productivity of high school chemistry teachers decreases. 
C) increases because the supply of high school chemistry teachers increases. 
D) decreases because the supply of high school chemistry teachers decreases.

Question 5

Jessica receives a raise at her current part-time job from $9 to $11 per hour. If her labor supply curve is backward sloping, she will work fewer hours after receiving the pay raise.

Accepted Answer

A) True 
 B)False

Question 6

The U.S. economy has been very successful in absorbing immigrants and putting them to work.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following could decrease the labor-supply curve for teachers?

Accepted Answer

A) a decrease in the wages paid to teachers 
B) an increase in immigration 
C) a change in the work preferences of men, with more of them preferring to be stay-at-home fathers 
D) any factor that would decrease the labor-demand curve

Question 8

Figure 18-7 
-Refer to Figure 18-7. Assume W1 = $15 and W2 = $12, and the market is always in equilibrium. A shift of the labor supply curve from S1 to S2 would

Accepted Answer

A) increase the value of the marginal product of labor by $3. 
B) decrease the value of the marginal product of labor by $3. 
C) decrease the value of the marginal product of labor by more than $3. 
D) not change the value of the marginal product of labor.

Question 9

Table 18-6 
-Refer to Table 18-6. What is the value for the cell labeled BB?

Accepted Answer

A) $300 
B) $200 
C) $100 
D) −$100

Question 10

If the value of the marginal product of labor is less than the wage, then the firm could

Accepted Answer

A) increase profit by hiring additional labor. 
B) increase profit by reducing the amount of labor hired. 
C) increase revenue by lowering output. 
D) reduce total cost by hiring additional workers.

Question 11

How does technological advance affect the demand for labor?

Accepted Answer

The answer of How does technological advance affect the demand...

Question 12

Table 18-1 
-Refer to Table 18-1. What is the marginal product of the third worker?

Accepted Answer

A) 7 
B) 8 
C) 25 
D) 75

Question 13

Suppose that Chloe opens a dog grooming business in a local shopping center. Which of the following would be an example of a factor of production used by Chloe?
(i)her employees' time
(ii)brushes, combs, scissors, and clippers
(iii)shampoo, water, and flea prevention treatments
(iv)Chloe's time spent on bookkeeping and bill paying

Accepted Answer

A) (i) only 
B) (i) and (ii) only 
C) (i), (ii), and (iii) only 
D) (i), (ii), (iii), and (iv)

Question 14

If the demand for labor decreases and the supply of labor is unchanged, then the opportunity cost of leisure will decrease.

Accepted Answer

A) True 
 B)False

Question 15

Table 18-9
The following table shows the production function for a particular business. The numbers represent the various labor and output combinations the firm may choose for its output on a daily basis. 
-Refer to Table 18-9. Suppose this firm charges a price of $5 per unit of output and pays workers a wage equal to $160 per day. What is the value of the marginal product of labor for the third worker?

Accepted Answer

A) $90 
B) $250 
C) $300 
D) $800

Question 16

An increase in the value of the marginal product of labor has the effect of increasing the

Accepted Answer

A) demand for labor. 
B) wage. 
C) quantity of labor employed. 
D) All of the above are correct.

Question 17

Which of the following events would bring about a change in the value of the marginal product of labor?

Accepted Answer

A) technological progress that alters the amount a worker can produce 
B) a change in the marginal product of labor 
C) a change in the price of the product that the firm sells 
D) All of the above are correct.

Question 18

Suppose that eight workers can manufacture 70 radios per day and that nine workers can manufacture 90 radios per day. If radios can be sold for $20 each, the value of marginal product of the ninth worker is

Accepted Answer

A) 20 radios. 
B) 90 radios. 
C) $200. 
D) $400.

Question 19

When an individual's income goes up, that individual may choose to supply less labor, resulting in a backward-sloping labor supply curve.

Accepted Answer

A) True 
 B)False

Question 20

Capital, labor, and land

Accepted Answer

A) have derived demands. 
B) are factors of production. 
C) are inputs used in the production of goods and services. 
D) All of the above are correct.

Exam 18: The Markets for the Factors of Production

When a competitive firm hires labor up to the point at which the value of the marginal product of labor equals the wage, it also produces output up to the point at which marginal cost is equal to __________.

Figure 18-11 -Refer to Figure 18-11. What is measured on the vertical axis of the graph?

In the United States, technological advances help explain persistently rising employment in the face of rising wages.

Jessica receives a raise at her current part-time job from $9 to $11 per hour. If her labor supply curve is backward sloping, she will work fewer hours after receiving the pay raise.

The U.S. economy has been very successful in absorbing immigrants and putting them to work.

Which of the following could decrease the labor-supply curve for teachers?

Figure 18-7 -Refer to Figure 18-7. Assume W₁ = $15 and W₂ = $12, and the market is always in equilibrium. A shift of the labor supply curve from S₁ to S₂ would

Table 18-6 -Refer to Table 18-6. What is the value for the cell labeled BB?

If the value of the marginal product of labor is less than the wage, then the firm could

How does technological advance affect the demand for labor?

Table 18-1 -Refer to Table 18-1. What is the marginal product of the third worker?

If the demand for labor decreases and the supply of labor is unchanged, then the opportunity cost of leisure will decrease.

An increase in the value of the marginal product of labor has the effect of increasing the

Which of the following events would bring about a change in the value of the marginal product of labor?

Suppose that eight workers can manufacture 70 radios per day and that nine workers can manufacture 90 radios per day. If radios can be sold for $20 each, the value of marginal product of the ninth worker is

When an individual's income goes up, that individual may choose to supply less labor, resulting in a backward-sloping labor supply curve.

Capital, labor, and land

Exam 18: The Markets for the Factors of Production

When a competitive firm hires labor up to the point at which the value of the marginal product of labor equals the wage, it also produces output up to the point at which marginal cost is equal to __________.

Figure 18-11 -Refer to Figure 18-11. What is measured on the vertical axis of the graph?

In the United States, technological advances help explain persistently rising employment in the face of rising wages.

Jessica receives a raise at her current part-time job from $9 to $11 per hour. If her labor supply curve is backward sloping, she will work fewer hours after receiving the pay raise.

The U.S. economy has been very successful in absorbing immigrants and putting them to work.

Which of the following could decrease the labor-supply curve for teachers?

Figure 18-7 -Refer to Figure 18-7. Assume W1 = $15 and W2 = $12, and the market is always in equilibrium. A shift of the labor supply curve from S1 to S2 would

Table 18-6 -Refer to Table 18-6. What is the value for the cell labeled BB?

If the value of the marginal product of labor is less than the wage, then the firm could

How does technological advance affect the demand for labor?

Table 18-1 -Refer to Table 18-1. What is the marginal product of the third worker?

If the demand for labor decreases and the supply of labor is unchanged, then the opportunity cost of leisure will decrease.

An increase in the value of the marginal product of labor has the effect of increasing the

Which of the following events would bring about a change in the value of the marginal product of labor?

Suppose that eight workers can manufacture 70 radios per day and that nine workers can manufacture 90 radios per day. If radios can be sold for $20 each, the value of marginal product of the ninth worker is

When an individual's income goes up, that individual may choose to supply less labor, resulting in a backward-sloping labor supply curve.

Capital, labor, and land

Figure 18-7 -Refer to Figure 18-7. Assume W₁ = $15 and W₂ = $12, and the market is always in equilibrium. A shift of the labor supply curve from S₁ to S₂ would