Question 1

Figure 18-4
The graph below illustrates the market for nurses who work in doctors' offices. 
-Refer to Figure 18-4. If doctors' offices adopt new labor-augmenting technologies, 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) All of the above
F) B) and D)

Question 2

Capital is paid according to the value of its marginal product

Accepted Answer

A)  only if earnings from capital are paid to households in the form of dividends.
B)  only if earnings from capital are kept within firms as retained earnings.
C)  regardless of whether earnings from capital are paid to households in the form of dividends or whether those earnings are kept within firms as retained earnings.
D)  None of the above is correct; unlike labor, capital is a factor of production for which earnings are unrelated to the value of marginal product.E) None of the above
F) A) and B)

Question 3

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 4

The theory of labor supply is based on the trade-off between __________.

Accepted Answer

The answer of The theory of labor supply is based...

Question 5

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. What is the marginal product of the third worker?

Accepted Answer

A)  220 students
B)  73.33 students
C)  50 students
D)  30 studentsE) B) and D)
F) A) and B)

Question 6

Table 18-7 
-Refer to Table 18-7. What is the value of the cell labeled JJ?

Accepted Answer

A)  -$300
B)  -$200
C)  -$100
D)  $0E) A) and C)
F) A) and B)

Question 7

Which of the following statements is correct?

Accepted Answer

A)  An increase in the supply of other factors, such as capital, will increase the demand for labor.
B)  Labor-saving technology will increase the demand for labor.
C)  Labor-augmenting technology will decrease the demand for labor.
D)  A decrease in the price of output will increase the demand for labor.E) A) and B)
F) A) and C)

Question 8

Suppose a labor-augmenting technology were developed for a product that increased the marginal product of labor for all workers. Which of the following would happen in the labor market for this product?

Accepted Answer

A)  Demand would decrease.
B)  Demand would increase.
C)  Supply would decrease.
D)  Supply would increase.E) A) and D)
F) C) and D)

Question 9

We observe a profit-maximizing firm hiring its 75th employee. It is possible to infer that, when 74 employees are hired, the

Accepted Answer

A)  wage exceeds the value of the marginal product of labor.
B)  value of the marginal product of labor exceeds the wage.
C)  marginal product of labor is increasing.
D)  firm is attempting to increase its market share.E) B) and C)
F) A) and D)

Question 10

Which term below refers to "the accumulation of goods produced in the past that are being used in the present to produce new goods and services"?

Accepted Answer

A)  inventories
B)  products
C)  factors of production
D)  capitalE) A) and D)
F) None of the above

Question 11

Figure 18-7 1, and the labor market is in equilibrium, the A) wage is W1. B) opportunity cost of leisure to workers is W1. C) value of the marginal product of labor to firms is W1. D) All of the above are correct." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 18-7. When the relevant labor supply curve is S1, and the labor market is in equilibrium, the

Accepted Answer

A)  wage is W1.
B)  opportunity cost of leisure to workers is W1.
C)  value of the marginal product of labor to firms is W1.
D)  All of the above are correct.E) A) and B)
F) None of the above

Question 12

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 25 hours per week, but now she decides to work 20 hours per week in order to spend more time studying economics. For this price range, her labor supply curve is

Accepted Answer

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

Question 13

Suppose that workers immigrate to Minnesota from Canada. Which of the following correctly describes what would happen in the market for labor in Minnesota?

Accepted Answer

A)  The equilibrium wage would increase, and the quantity of labor would increase. With more workers, the added output from an extra worker is larger.
B)  The equilibrium wage would decrease, and the quantity of labor would decrease. With fewer workers, the added output from an extra worker is smaller.
C)  The equilibrium wage would decrease, and the quantity of labor would increase. With more workers, the added output from an extra worker is smaller.
D)  The equilibrium wage would decrease, and the quantity of labor would increase. With more workers, the added output from an extra worker is larger.E) A) and C)
F) A) and B)

Question 14

As a result of increasing its workforce from 9 workers to 10 workers, a firm's total revenue per day increases from $60,000 to $60,250 and its total cost per day increases from $58,500 to $58,700. The marginal profit of the 10th worker is

Accepted Answer

A)  -$50.
B)  $50.
C)  $200.
D)  $250.E) B) and C)
F) C) and D)

Question 15

Using the theory of wage determination, explain why wages in developing countries, where levels of capital are small, are typically quite low.

Accepted Answer

Wages are determined by the value of wor...

Question 16

For competitive firms, the curve that represents the value of marginal product of labor is the same as the demand for labor curve.

Accepted Answer

A) True 
 B)False

Question 17

Table 18-12
The table displays data for a small, competitive, profit-maximizing firm that produces and sells envelopes. The time frame is one week. 
-Refer to Table 18-12. Suppose the firm sells each box of envelopes that it produces for $7. Suppose also that the firm's fixed costs amount to $400. How many workers should the firm hire in order to maximize profit, and what is the maximum profit?

Accepted Answer

A)  The firm should hire 2 workers; its maximum profit is $80.
B)  The firm should hire 2 workers; its maximum profit is $96.
C)  The firm should hire 3 workers; its maximum profit is $96.
D)  The firm should hire 3 workers; its maximum profit is $124.E) A) and D)
F) A) and C)

Question 18

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 the marginal product of the fifth unit of labor is 30 units of output per day. The figure implies that the

Accepted Answer

A)  price of output is $4.
B)  price of output is $6.
C)  price of output is $8.
D)  daily wage is $120.E) A) and C)
F) All of the above

Question 19

Table 18-B
Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day. 
-Refer to Table 18-11. What is the marginal profit of the fourth worker?

Accepted Answer

A)  $280
B)  $25
C)  -$5
D)  -$45E) B) and C)
F) A) and C)

Question 20

Figure 18-1
On the graph, L represents the quantity of labor and Q represents the quantity of output per week. 
-Refer to Figure 18-1. The figure illustrates the

Accepted Answer

A)  demand for labor.
B)  supply of labor.
C)  production function.
D)  wage function.E) A) and B)
F) A) and C)

Exam 18: The Markets for the Factors of Production

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 25 hours per week, but now she decides to work 20 hours per week in order to spend more time studying economics. For this price range, her labor supply curve is

Correct Answer
verified

We observe a profit-maximizing firm hiring its 75th employee. It is possible to infer that, when 74 employees are hired, the

Correct Answer
verified

Using the theory of wage determination, explain why wages in developing countries, where levels of capital are small, are typically quite low.

Correct Answer
verified
Wages are determined by the value of wor...
View Answer

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. What is the marginal product of the third worker?

Correct Answer
verified

For competitive firms, the curve that represents the value of marginal product of labor is the same as the demand for labor curve.

Correct Answer
verified

Figure 18-7 -Refer to Figure 18-7. When the relevant labor supply curve is S₁, and the labor market is in equilibrium, the

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 statements is correct?

Correct Answer
verified

Correct Answer
verified

As a result of increasing its workforce from 9 workers to 10 workers, a firm's total revenue per day increases from $60,000 to $60,250 and its total cost per day increases from $58,500 to $58,700. The marginal profit of the 10^th worker is

Correct Answer
verified

Which term below refers to "the accumulation of goods produced in the past that are being used in the present to produce new goods and services"?

Correct Answer
verified

Figure 18-4 The graph below illustrates the market for nurses who work in doctors' offices. -Refer to Figure 18-4. If doctors' offices adopt new labor-augmenting technologies, what happens in the market for nurses?

Correct Answer
verified

Figure 18-1 On the graph, L represents the quantity of labor and Q represents the quantity of output per week. -Refer to Figure 18-1. The figure illustrates the

Correct Answer
verified

Capital is paid according to the value of its marginal product

Correct Answer
verified

Table 18-B Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day. -Refer to Table 18-11. What is the marginal profit of the fourth worker?

Correct Answer
verified

Suppose a labor-augmenting technology were developed for a product that increased the marginal product of labor for all workers. Which of the following would happen in the labor market for this product?

Correct Answer
verified

Correct Answer
verified

Suppose that workers immigrate to Minnesota from Canada. Which of the following correctly describes what would happen in the market for labor in Minnesota?

Correct Answer
verified

The theory of labor supply is based on the trade-off between __________.

Correct Answer
verified

Table 18-7 -Refer to Table 18-7. What is the value of the cell labeled JJ?

Correct Answer
verified

Exam 18: The Markets for the Factors of Production

Your college roommate receives a pay raise at her part-time job from $9 to $11 per hour. She used to work 25 hours per week, but now she decides to work 20 hours per week in order to spend more time studying economics. For this price range, her labor supply curve is

Correct AnswerverifiedShow Answer

We observe a profit-maximizing firm hiring its 75th employee. It is possible to infer that, when 74 employees are hired, the

Correct AnswerverifiedShow Answer

Using the theory of wage determination, explain why wages in developing countries, where levels of capital are small, are typically quite low.

Correct AnswerverifiedWages are determined by the value of wor...View AnswerShow Answer

Correct AnswerverifiedShow Answer

For competitive firms, the curve that represents the value of marginal product of labor is the same as the demand for labor curve.

Correct AnswerverifiedShow Answer

Figure 18-7 -Refer to Figure 18-7. When the relevant labor supply curve is S1, and the labor market is in equilibrium, the

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 statements is correct?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

As a result of increasing its workforce from 9 workers to 10 workers, a firm's total revenue per day increases from $60,000 to $60,250 and its total cost per day increases from $58,500 to $58,700. The marginal profit of the 10th worker is

Correct AnswerverifiedShow Answer

Which term below refers to "the accumulation of goods produced in the past that are being used in the present to produce new goods and services"?

Correct AnswerverifiedShow Answer

Figure 18-4 The graph below illustrates the market for nurses who work in doctors' offices. -Refer to Figure 18-4. If doctors' offices adopt new labor-augmenting technologies, what happens in the market for nurses?

Correct AnswerverifiedShow Answer

Figure 18-1 On the graph, L represents the quantity of labor and Q represents the quantity of output per week. -Refer to Figure 18-1. The figure illustrates the

Correct AnswerverifiedShow Answer

Capital is paid according to the value of its marginal product

Correct AnswerverifiedShow Answer

Table 18-B Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day. -Refer to Table 18-11. What is the marginal profit of the fourth worker?

Correct AnswerverifiedShow Answer

Suppose a labor-augmenting technology were developed for a product that increased the marginal product of labor for all workers. Which of the following would happen in the labor market for this product?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Suppose that workers immigrate to Minnesota from Canada. Which of the following correctly describes what would happen in the market for labor in Minnesota?

Correct AnswerverifiedShow Answer

The theory of labor supply is based on the trade-off between __________.

Correct AnswerverifiedShow Answer

Table 18-7 -Refer to Table 18-7. What is the value of the cell labeled JJ?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Wages are determined by the value of wor...
View Answer

Correct Answer
verified

Correct Answer
verified

Figure 18-7 -Refer to Figure 18-7. When the relevant labor supply curve is S₁, and the labor market is in equilibrium, the

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified

As a result of increasing its workforce from 9 workers to 10 workers, a firm's total revenue per day increases from $60,000 to $60,250 and its total cost per day increases from $58,500 to $58,700. The marginal profit of the 10^th worker is

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified