Question 1

In general,less productive workers are paid less than more productive workers.

Accepted Answer

A) True 
 B)False

Question 2

Figure 18-2
The figure below shows the production function for a particular firm. 
-Refer to Figure 18-2.Suppose the firm pays a wage equal to $160 per unit of labor and sells its output at $10 per unit.What is the value of the marginal product of labor for the third worker?

Accepted Answer

A)   20 units
B)   $200
C)   $2,720
D)   $3,200E) A) and B)
F) A) and C)

Question 3

Figure 18-10 2 and the current wage is W1, A)  there is a surplus of labor. B)  there is a shortage of labor. C)  the quantity of labor supplied exceeds the quantity of labor demanded. D)  workers are failing to take into account the work-leisure tradeoff in deciding what quantity of labor to supply at alternative wages." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 18-10.If the relevant labor demand curve is D2 and the current wage is W1,

Accepted Answer

A)   there is a surplus of labor.
B)   there is a shortage of labor.
C)   the quantity of labor supplied exceeds the quantity of labor demanded.
D)   workers are failing to take into account the work-leisure tradeoff in deciding what quantity of labor to supply at alternative wages.E) A) and B)
F) B) and C)

Question 4

Christine works for a firm that makes tires for cars.How is Christine's wage affected if the demand for cars increases?

Accepted Answer

The increase in the demand for...

Question 5

In order to study labor markets more easily,we make which of the following assumptions about firms?
 (i) Firms sell their products in competitive markets.
(ii) Firms buy their inputs in competitive markets.
(iii) Firms maximize profits.
(iv) Firms maximize revenues.

Accepted Answer

A)   (iii) only
B)   (i) and (iii) only
C)   (i) , (ii) ,and (iii) only
D)   (i) , (ii) , (iii) ,and (iv) E) A) and B)
F) None of the above

Question 6

When a production function exhibits a diminishing,but positive,marginal product of labor,

Accepted Answer

A)   output increases,but at an increasing rate,as more workers are employed.
B)   output increases,but at a decreasing rate,as more workers are employed.
C)   output declines as more workers are employed.
D)   the effects on marginal product are ambiguous.E) B) and D)
F) C) and D)

Question 7

Immigration is an important

Accepted Answer

A)   explanation for the failure of firms to operate on their labor-demand curves.
B)   explanation for the failure of firms to operate on their output-supply curves.
C)   source of shifts in labor demand.
D)   source of shifts in labor supply.E) B) and C)
F) None of the above

Question 8

Which of the following would be an example of capital for a computer software firm? (i) 
The firm's computer programmers
(ii) 
The wages the firm pays to its computer programmers
(iii) 
Computer equipment

Accepted Answer

A)   (i) only
B)   (ii) only
C)   (iii) only
D)   (i) and (iii) onlyE) C) and D)
F) B) and C)

Question 9

Suppose a shift of the demand curve for strawberry pickers causes the equilibrium wage of strawberry pickers to increase by $2.The price of strawberries is $3 per pound before and after the shift.Does the shift increase the marginal product of the last picker hired,or does it decrease it? What is the amount of the increase or decrease?

Accepted Answer

In equilibrium, <img  loading="lazy" src="/assets/images/blured-textbook.svg" class="d-inline m-1" alt="blured image" width="139" height="30"> ,so...

Question 10

As the number of concrete workers in the United States falls,the wage paid to the remaining concrete workers will necessarily fall as well.

Accepted Answer

A) True 
 B)False

Question 11

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.E) B) and C)
F) C) and D)

Question 12

A profit-maximizing competitive firm will hire workers up to the point at which the wage equals the marginal product of labor.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is correct?

Accepted Answer

A)   Any event that changes the supply or demand for labor must change the value of the marginal product.
B)   A profit-maximizing firm hires workers so long as the wage rate exceeds the value of the marginal product of labor.
C)   An increase in the supply of labor increases both employment and wages.
D)   A decrease in the demand for labor decreases wages but increases employment.E) B) and D)
F) A) and B)

Question 14

The labor supply curve shifts when

Accepted Answer

A)   employers need to hire more people.
B)   employers develop new technology.
C)   workers change the number of hours that they want to work at any given wage.
D)   workers become more productive.E) A) and C)
F) A) and D)

Question 15

Table 18-6
 
-Refer to Table 18-6.It is apparent from this table that increasing marginal product

Accepted Answer

A)   occurs only after the first worker is hired.
B)   occurs only after the second worker is hired.
C)   occurs only after the third worker is hired.
D)   never occurs.E) All of the above
F) B) and D)

Question 16

Because workers in the U.S.economy receive most of the total income earned,which of the following factors of production is considered to be the most important?

Accepted Answer

A)   profit
B)   wages
C)   interest
D)   laborE) C) and D)
F) None of the above

Question 17

According to the neoclassical theory of distribution,the wages paid to workers depend on the

Accepted Answer

A)   supply of labor.
B)   demand for labor.
C)   marginal productivity of labor.
D)   All of the above are correct.E) A) and B)
F) A) and D)

Question 18

If a firm is able to charge a higher price for its output,all else equal,the value of the marginal product of labor will decrease to offset the higher price.

Accepted Answer

A) True 
 B)False

Question 19

In 2010,the total income of all U.S.residents was approximately $120 billion.

Accepted Answer

A) True 
 B)False

Question 20

The accumulation of machinery and buildings used in the production of new goods and services is referred to as

Accepted Answer

A)   production factors.
B)   output factors.
C)   capital.
D)   equity.E) A) and D)
F) A) and C)

Exam 18: The Market for the Factors of Production

According to the neoclassical theory of distribution,the wages paid to workers depend on the

Correct Answer
verified

A profit-maximizing competitive firm will hire workers up to the point at which the wage equals the marginal product of labor.

Correct Answer
verified

Because workers in the U.S.economy receive most of the total income earned,which of the following factors of production is considered to be the most important?

Correct Answer
verified

Figure 18-2 The figure below shows the production function for a particular firm. -Refer to Figure 18-2.Suppose the firm pays a wage equal to $160 per unit of labor and sells its output at $10 per unit.What is the value of the marginal product of labor for the third worker?

Correct Answer
verified

The labor supply curve shifts when

Correct Answer
verified

Christine works for a firm that makes tires for cars.How is Christine's wage affected if the demand for cars increases?

Correct Answer
verified
The increase in the demand for...
View Answer

Which of the following would be an example of capital for a computer software firm? (i) The firm's computer programmers (ii) The wages the firm pays to its computer programmers (iii) Computer equipment

Correct Answer
verified

In general,less productive workers are paid less than more productive workers.

Correct Answer
verified

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

Correct Answer
verified

Figure 18-10 -Refer to Figure 18-10.If the relevant labor demand curve is D₂ and the current wage is W₁,

Correct Answer
verified

In 2010,the total income of all U.S.residents was approximately $120 billion.

Correct Answer
verified

Correct Answer
verified
In equilibrium, ,so...
View Answer

In order to study labor markets more easily,we make which of the following assumptions about firms? (i) Firms sell their products in competitive markets. (ii) Firms buy their inputs in competitive markets. (iii) Firms maximize profits. (iv) Firms maximize revenues.

Correct Answer
verified

The accumulation of machinery and buildings used in the production of new goods and services is referred to as

Correct Answer
verified

As the number of concrete workers in the United States falls,the wage paid to the remaining concrete workers will necessarily fall as well.

Correct Answer
verified

Table 18-6 -Refer to Table 18-6.It is apparent from this table that increasing marginal product

Correct Answer
verified

Which of the following is correct?

Correct Answer
verified

If a firm is able to charge a higher price for its output,all else equal,the value of the marginal product of labor will decrease to offset the higher price.

Correct Answer
verified

When a production function exhibits a diminishing,but positive,marginal product of labor,

Correct Answer
verified

Immigration is an important

Correct Answer
verified

Exam 18: The Market for the Factors of Production

According to the neoclassical theory of distribution,the wages paid to workers depend on the

Correct AnswerverifiedShow Answer

A profit-maximizing competitive firm will hire workers up to the point at which the wage equals the marginal product of labor.

Correct AnswerverifiedShow Answer

Because workers in the U.S.economy receive most of the total income earned,which of the following factors of production is considered to be the most important?

Correct AnswerverifiedShow Answer

Figure 18-2 The figure below shows the production function for a particular firm. -Refer to Figure 18-2.Suppose the firm pays a wage equal to $160 per unit of labor and sells its output at $10 per unit.What is the value of the marginal product of labor for the third worker?

Correct AnswerverifiedShow Answer

The labor supply curve shifts when

Correct AnswerverifiedShow Answer

Christine works for a firm that makes tires for cars.How is Christine's wage affected if the demand for cars increases?

Correct AnswerverifiedThe increase in the demand for...View AnswerShow Answer

Which of the following would be an example of capital for a computer software firm? (i) The firm's computer programmers (ii) The wages the firm pays to its computer programmers (iii) Computer equipment

Correct AnswerverifiedShow Answer

In general,less productive workers are paid less than more productive workers.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Figure 18-10 -Refer to Figure 18-10.If the relevant labor demand curve is D2 and the current wage is W1,

Correct AnswerverifiedShow Answer

In 2010,the total income of all U.S.residents was approximately $120 billion.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedIn equilibrium, ,so...View AnswerShow Answer

In order to study labor markets more easily,we make which of the following assumptions about firms? (i) Firms sell their products in competitive markets. (ii) Firms buy their inputs in competitive markets. (iii) Firms maximize profits. (iv) Firms maximize revenues.

Correct AnswerverifiedShow Answer

The accumulation of machinery and buildings used in the production of new goods and services is referred to as

Correct AnswerverifiedShow Answer

As the number of concrete workers in the United States falls,the wage paid to the remaining concrete workers will necessarily fall as well.

Correct AnswerverifiedShow Answer

Table 18-6 -Refer to Table 18-6.It is apparent from this table that increasing marginal product

Correct AnswerverifiedShow Answer

Which of the following is correct?

Correct AnswerverifiedShow Answer

If a firm is able to charge a higher price for its output,all else equal,the value of the marginal product of labor will decrease to offset the higher price.

Correct AnswerverifiedShow Answer

When a production function exhibits a diminishing,but positive,marginal product of labor,

Correct AnswerverifiedShow Answer

Immigration is an important

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The increase in the demand for...
View Answer

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Figure 18-10 -Refer to Figure 18-10.If the relevant labor demand curve is D₂ and the current wage is W₁,

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In equilibrium, ,so...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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