Question 1

Figure 18-7 1 to S2? A) technological progress B) a decrease in the price of the firm's output C) a change in workers' attitudes toward the work-leisure tradeoff D) an increase in the price of the firm's output" class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 18-7. Which of the following would shift the labor supply curve from S1 to S2?

Accepted Answer

A)  technological progress
B)  a decrease in the price of the firm's output
C)  a change in workers' attitudes toward the work-leisure tradeoff
D)  an increase in the price of the firm's outputE) All of the above
F) A) and C)

Question 2

Total income in the United States is comprised of

Accepted Answer

A)  wages only.
B)  wages and fringe benefits only.
C)  rents, profits, and interest payments only.
D)  wages, fringe benefits, rents, profits, and interest payments.E) A) and C)
F) A) and D)

Question 3

Suppose that a competitive firm hires labor up to the point at which the value of the marginal product equals the wage and that labor is the only input that varies for the firm. If the firm pays a wage of $700 per week and the marginal product of labor equals 10 units per week, then the marginal cost of producing an additional unit of output is

Accepted Answer

A)  $7.
B)  $70.
C)  $700.
D)  We do not have enough information to answer this question.E) A) and B)
F) A) and C)

Question 4

Figure 18-7 1 to S2? A) a change in workers' attitudes toward the work-leisure tradeoff B) decreases in wages in other labor markets C) immigration of workers into the region or country D) All of the above are correct." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 18-7. Which of the following would shift the labor supply curve from S1 to S2?

Accepted Answer

A)  a change in workers' attitudes toward the work-leisure tradeoff
B)  decreases in wages in other labor markets
C)  immigration of workers into the region or country
D)  All of the above are correct.E) A) and B)
F) None of the above

Question 5

Figure 18-4
The graph below illustrates the market for nurses who work in doctors' offices. 
-Refer to Figure 18-4. Each August many high school and college students visit a doctor's office to have a sports physical. If the price of sports physicals falls, what happens in the market for nurses?

Accepted Answer

A)  Demand increases from D1 to D2.
B)  Demand decreases from D2 to D1.
C)  Supply increases from S1 to S2.
D)  Supply decreases from S2 to S1.E) B) and D)
F) B) and C)

Question 6

A profit-maximizing competitive firm will hire workers up to the point at which the wage equals the price of the final good multiplied by the marginal product of the last worker hired.

Accepted Answer

A) True 
 B)False

Question 7

Table 18-A 
-Refer to Table 18-A. The price of output is

Accepted Answer

A)  $5.
B)  $3.
C)  $2.
D)  $1.E) C) and D)
F) A) and B)

Question 8

When we focus on labor as an input in the production process, we typically draw the production function by measuring the

Accepted Answer

A)  quantity of labor on the horizontal axis and the quantity of output on the vertical axis.
B)  quantity of labor on the horizontal axis and the marginal product of labor on the vertical axis.
C)  quantity of labor on the horizontal axis and the value of the marginal product of labor on the vertical axis.
D)  value of the marginal product of labor on the horizontal axis and the quantity of output on the vertical axis.E) None of the above
F) A) and B)

Question 9

Competitive firms that maximize profits will hire workers until the value of the marginal product of labor

Accepted Answer

A)  equals the wage.
B)  equals the price of the final good.
C)  begins to fall.
D)  begins to rise.E) All of the above
F) A) and B)

Question 10

Suppose that a competitive firm hires labor up to the point at which the value of the marginal product equals the wage and that labor is the only input that varies for the firm. If the firm pays a wage of $700 per week and the marginal product of labor equals 35 units per week, then the marginal cost of producing an additional unit of output is

Accepted Answer

A)  $20.
B)  $35.
C)  $700.
D)  We do not have enough information to answer this question.E) A) and D)
F) None of the above

Question 11

Figure 18-5
The figure shows a particular profit-maximizing, competitive firm's value-of-marginal-product (VMP)  curve. On the horizontal axis, L represents the number of workers. The time frame is daily. 
-Refer to Figure 18-5. Suppose one point on the firm's production function is (L = 3, Q = 180) , where L = number of workers and Q = quantity of output. If the firm sells its output for $5 per unit, then

Accepted Answer

A)  a second point on the firm's production function is (L = 4, Q = 216) .
B)  the firm's production function exhibits the property of diminishing marginal product of labor.
C)  the firm will maximize profit by hiring four workers if it pays workers $160 per day.
D)  All of the above are correct.E) B) and C)
F) A) and B)

Question 12

Figure 18-9 
-Refer to Figure 18-9. If the price of apples increases, the

Accepted Answer

A)  demand for apple pickers will shift to the left.
B)  demand for apple pickers will shift to the right.
C)  supply of apple pickers will shift to the left.
D)  supply of apple pickers will shift to the right.E) A) and B)
F) B) and C)

Question 13

Describe the difference between the purchase price of capital and the rental price of capital. If you know the value of marginal product from the flow of capital services, how would you determine the market price for the capital stock?

Accepted Answer

The purchase price of capital is a refle...

Question 14

Which of the following could increase the supply of labor in the market for cranberry pickers? (i) 
A change in the preferences of women toward full-time work
(ii) 
An increase in the output price
(iii) 
An increase in the wages paid to apple pickers
(iv) 
A decrease in the wages paid to apple pickers

Accepted Answer

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

Question 15

Scenario 18-4
In 1997, Albania experienced a civil war. The civil unrest sent thousands of refugees across the Adriatic Sea to Italy where they sought relief from the fighting.
-Refer to Scenario 18-4. The Italian government started to patrol the Adriatic Sea and had a policy of returning all refugees to Albania. This policy would contribute to

Accepted Answer

A)  an increase in the supply of labor in Italy.
B)  an increase in the demand labor in Italy.
C)  a decrease in the demand for labor in Italy.
D)  preventing an increase in the supply of labor in Italy.E) All of the above
F) A) and B)

Question 16

Among the people who are characterized below, who has the highest opportunity cost of leisure?

Accepted Answer

A)  an attorney who earns $200 per hour and who plays golf during her leisure time
B)  a medical doctor who earns $210 per hour and who sleeps during his leisure time
C)  a retail clerk who earns $15 per hour and who watches TV during her leisure time
D)  a waiter who earns $12 per hour and who reads poetry during his leisure timeE) C) and D)
F) All of the above

Question 17

Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

Accepted Answer

A)  The VMPL increases by less than $4.
B)  The VMPL increases by $4.
C)  The VMPL increases by more than $4.
D)  The VMPL decreases by $4.E) B) and C)
F) All of the above

Question 18

Which of the following events can cause the labor-supply curve to shift?

Accepted Answer

A)  an increase in the wage rate
B)  an increase in the price of output
C)  an increase in the rate of immigration
D)  a technological advanceE) All of the above
F) B) and C)

Question 19

Table 18-8
Harold and Maude own a dance studio where they and their employees teach ballroom dancing. Their company is a competitive, profit-maximizing firm. Harold and Maude's production function is detailed in the table below. 
-Refer to Table 18-8. If Harold and Maude pay their workers $80 per day and charge $20 per dance lesson, what is the value of the marginal product of the second worker?

Accepted Answer

A)  $400
B)  $800
C)  $1,600
D)  $4,800E) B) and C)
F) None of the above

Question 20

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is

Accepted Answer

A)  vertical.
B)  horizontal.
C)  upward sloping.
D)  backward sloping.E) C) and D)
F) None of the above

Exam 18: The Markets for the Factors of Production

Correct Answer
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Figure 18-9 -Refer to Figure 18-9. If the price of apples increases, the

Correct Answer
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Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is

Correct Answer
verified

When we focus on labor as an input in the production process, we typically draw the production function by measuring the

Correct Answer
verified

Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

Correct Answer
verified

Correct Answer
verified

Which of the following events can cause the labor-supply curve to shift?

Correct Answer
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Total income in the United States is comprised of

Correct Answer
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Which of the following could increase the supply of labor in the market for cranberry pickers? (i) A change in the preferences of women toward full-time work (ii) An increase in the output price (iii) An increase in the wages paid to apple pickers (iv) A decrease in the wages paid to apple pickers

Correct Answer
verified

Describe the difference between the purchase price of capital and the rental price of capital. If you know the value of marginal product from the flow of capital services, how would you determine the market price for the capital stock?

Correct Answer
verified
The purchase price of capital is a refle...
View Answer

A profit-maximizing competitive firm will hire workers up to the point at which the wage equals the price of the final good multiplied by the marginal product of the last worker hired.

Correct Answer
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Figure 18-7 -Refer to Figure 18-7. Which of the following would shift the labor supply curve from S₁ to S₂?

Correct Answer
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Figure 18-7 -Refer to Figure 18-7. Which of the following would shift the labor supply curve from S₁ to S₂?

Correct Answer
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Competitive firms that maximize profits will hire workers until the value of the marginal product of labor

Correct Answer
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Correct Answer
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Correct Answer
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Figure 18-4 The graph below illustrates the market for nurses who work in doctors' offices. -Refer to Figure 18-4. Each August many high school and college students visit a doctor's office to have a sports physical. If the price of sports physicals falls, what happens in the market for nurses?

Correct Answer
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Correct Answer
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Table 18-A -Refer to Table 18-A. The price of output is

Correct Answer
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Among the people who are characterized below, who has the highest opportunity cost of leisure?

Correct Answer
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Exam 18: The Markets for the Factors of Production

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Figure 18-9 -Refer to Figure 18-9. If the price of apples increases, the

Correct AnswerverifiedShow Answer

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 10 hours per week, but now she decides to work 15 hours per week. For this price range, her labor supply curve is

Correct AnswerverifiedShow Answer

When we focus on labor as an input in the production process, we typically draw the production function by measuring the

Correct AnswerverifiedShow Answer

Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following events can cause the labor-supply curve to shift?

Correct AnswerverifiedShow Answer

Total income in the United States is comprised of

Correct AnswerverifiedShow Answer

Which of the following could increase the supply of labor in the market for cranberry pickers? (i) A change in the preferences of women toward full-time work (ii) An increase in the output price (iii) An increase in the wages paid to apple pickers (iv) A decrease in the wages paid to apple pickers

Correct AnswerverifiedShow Answer

Describe the difference between the purchase price of capital and the rental price of capital. If you know the value of marginal product from the flow of capital services, how would you determine the market price for the capital stock?

Correct AnswerverifiedThe purchase price of capital is a refle...View AnswerShow Answer

A profit-maximizing competitive firm will hire workers up to the point at which the wage equals the price of the final good multiplied by the marginal product of the last worker hired.

Correct AnswerverifiedShow Answer

Figure 18-7 -Refer to Figure 18-7. Which of the following would shift the labor supply curve from S1 to S2?

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Figure 18-7 -Refer to Figure 18-7. Which of the following would shift the labor supply curve from S1 to S2?

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Competitive firms that maximize profits will hire workers until the value of the marginal product of labor

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Figure 18-4 The graph below illustrates the market for nurses who work in doctors' offices. -Refer to Figure 18-4. Each August many high school and college students visit a doctor's office to have a sports physical. If the price of sports physicals falls, what happens in the market for nurses?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 18-A -Refer to Table 18-A. The price of output is

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Among the people who are characterized below, who has the highest opportunity cost of leisure?

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The purchase price of capital is a refle...
View Answer

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Figure 18-7 -Refer to Figure 18-7. Which of the following would shift the labor supply curve from S₁ to S₂?

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Figure 18-7 -Refer to Figure 18-7. Which of the following would shift the labor supply curve from S₁ to S₂?

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