Question 1

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.Suppose the firm sells its output for $12 per unit,and it pays each of its workers $700 per week.The value of the marginal product of the fifth worker is

Accepted Answer

A)   $540
B)   $700
C)   $720
D)   $1,080E) A) and B)
F) A) and C)

Question 2

Diane's Auto World installs tires on automobiles,light trucks,and sport utility vehicles.She is a profit-maximizing business owner whose firm operates in a competitive market.The marginal cost of installing a tire is $10.The marginal productivity of the last worker that Diane hired was 2 tires per hour.What is the maximum hourly wage that Diane was willing to pay the last worker hired?

Accepted Answer

A)   $5
B)   $10
C)   $20
D)   There is insufficient information to answer this question.E) B) and D)
F) A) and B)

Question 3

In a representative labor market,

Accepted Answer

A)   the wage adjusts to balance the supply and demand for labor.
B)   the wage equals the value of the marginal product of labor.
C)   an increase in the supply of labor increases the equilibrium wage.
D)   Both a and b are correct.E) B) and C)
F) A) and C)

Question 4

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

Accepted Answer

A)   80 units
B)   100 units
C)   180 units
D)   200 unitsE) None of the above
F) A) and B)

Question 5

A competitive,profit-maximizing firm hires workers up to the point where the

Accepted Answer

A)   marginal product equals zero.
B)   marginal revenue product equals zero.
C)   marginal product equals the wage.
D)   value of the marginal product equals the wage.E) A) and B)
F) All of the above

Question 6

Which of the following events would shift the labor supply curve?

Accepted Answer

A)   changes in the number of women willing to work
B)   immigration of workers
C)   changing attitudes towards work
D)   All of the above are correct.E) All of the above
F) C) and D)

Question 7

Scenario 18-1
Harry owns a snow-removal business. He hires workers to shovel driveways for him during the winter. The first worker he hires can shovel twelve driveways in one day. When Harry hires two workers, they can shovel a total of 22 driveways in one day. When Harry hires a third worker, he shovels an additional eight driveways in one day.
-Refer to Scenario 18-1.What is the marginal productivity of the second worker?

Accepted Answer

A)   7
B)   10
C)   12
D)   22E) All of the above
F) A) and B)

Question 8

If the output price of a product rises,the demand for capital will increase,raising the rental price of capital.

Accepted Answer

A) True 
 B)False

Question 9

Figure 18-6
 
-Refer to Figure 18-6.The graph above illustrates the market for bakers who make homemade breads and breakfast pastries.If the wages paid to wedding cake bakers decrease,what happens in the market for bread bakers?

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) A) and C)
F) A) and B)

Question 10

Which of the following statements is correct? An individual worker's labor supply curve

Accepted Answer

A)   can never be backward sloping.
B)   slopes backward if that person responds to a higher wage by taking fewer hours of leisure per week.
C)   slopes backward if that person responds to a higher opportunity cost of leisure by working fewer hours per week.
D)   slopes upward if that person works the same number of hours per week, regardless of the opportunity cost of leisure.E) B) and C)
F) A) and D)

Question 11

The term "factor market" applies to the market for

Accepted Answer

A)   labor.
B)   capital.
C)   land.
D)   All of the above are correct.E) B) and C)
F) A) and D)

Question 12

Factor markets are different from product markets in an important way because

Accepted Answer

A)   equilibrium is the exception, and not the rule, in factor markets.
B)   the demand for a factor of production is a derived demand.
C)   the demand for a factor of production is likely to be upward sloping, in violation of the law of demand.
D)   All of the above are correct.E) A) and D)
F) A) and C)

Question 13

Immigration of workers into the United States is often an important source of

Accepted Answer

A)   increases in the demand for labor in the United States.
B)   decreases in the demand for labor in the United States.
C)   increases in the supply of labor in the United States.
D)   decreases in the supply of labor in the United States.E) A) and C)
F) A) and D)

Question 14

Table 18-3
 
-Refer to Table 18-3.Which firm's production function exhibits positive but diminishing marginal product?

Accepted Answer

A)   Firm A
B)   Firm B
C)   Firm C
D)   Firm DE) A) and D)
F) B) and C)

Question 15

Scenario 18-6
Rocchetta Industries manufactures and supplies bottled water in Mexico. As a result of a contamination of water supplies at many of Mexico's resort communities, the demand for bottled water has increased.
-Refer to Scenario 18-6.We would expect that,as a result of the contamination,the value of the marginal product for Rocchetta Industries' workers would

Accepted Answer

A)   be offset by a decrease in wages.
B)   be unaffected by a rise in demand for bottled water.
C)   increase.
D)   decrease.E) A) and D)
F) All of the above

Question 16

Table 18-8
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 18-8.What is the marginal product of the third unit of labor?

Accepted Answer

A)   40 units
B)   50 units
C)   60 units
D)   180 unitsE) A) and D)
F) A) and C)

Question 17

Typically,as a firm hires additional workers,the marginal product of labor

Accepted Answer

A)   decreases, and the value of the marginal product of labor decreases.
B)   stays constant, and the value of the marginal product of labor decreases.
C)   decreases, and the value of the marginal product of labor stays constant.
D)   decreases, and the value of the marginal product of labor increases.E) B) and C)
F) B) and D)

Question 18

The marginal product of any factor of production depends on

Accepted Answer

A)   the quantity of the factor used.
B)   the price of the final good.
C)   the demand for the final good.
D)   All of the above are correct.E) None of the above
F) B) and C)

Question 19

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) B) and D)

Question 20

The basic tools of supply and demand apply to

Accepted Answer

A)   both markets for goods and services and markets for labor services.
B)   markets for goods and services but not to markets for labor services.
C)   markets for goods and services but not to markets for factors of production.
D)   all markets except those in which demand is derived demand.E) C) and D)
F) B) and D)

Exam 18: The Market For the Factors of Production.

If the output price of a product rises,the demand for capital will increase,raising the rental price of capital.

Correct Answer
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Correct Answer
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Table 18-3 -Refer to Table 18-3.Which firm's production function exhibits positive but diminishing marginal product?

Correct Answer
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Which of the following events would shift the labor supply curve?

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

Correct Answer
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Factor markets are different from product markets in an important way because

Correct Answer
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The marginal product of any factor of production depends on

Correct Answer
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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.Suppose the firm sells its output for $12 per unit,and it pays each of its workers $700 per week.The value of the marginal product of the fifth worker is

Correct Answer
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Correct Answer
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Immigration is an important

Correct Answer
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A competitive,profit-maximizing firm hires workers up to the point where the

Correct Answer
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In a representative labor market,

Correct Answer
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Table 18-8 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 18-8.What is the marginal product of the third unit of labor?

Correct Answer
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The term "factor market" applies to the market for

Correct Answer
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Figure 18-6 -Refer to Figure 18-6.The graph above illustrates the market for bakers who make homemade breads and breakfast pastries.If the wages paid to wedding cake bakers decrease,what happens in the market for bread bakers?

Correct Answer
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The basic tools of supply and demand apply to

Correct Answer
verified

Correct Answer
verified

Typically,as a firm hires additional workers,the marginal product of labor

Correct Answer
verified

Which of the following statements is correct? An individual worker's labor supply curve

Correct Answer
verified

Immigration of workers into the United States is often an important source of

Correct Answer
verified

Exam 18: The Market For the Factors of Production.

If the output price of a product rises,the demand for capital will increase,raising the rental price of capital.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 18-3 -Refer to Table 18-3.Which firm's production function exhibits positive but diminishing marginal product?

Correct AnswerverifiedShow Answer

Which of the following events would shift the labor supply curve?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Factor markets are different from product markets in an important way because

Correct AnswerverifiedShow Answer

The marginal product of any factor of production depends on

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.Suppose the firm sells its output for $12 per unit,and it pays each of its workers $700 per week.The value of the marginal product of the fifth worker is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Immigration is an important

Correct AnswerverifiedShow Answer

A competitive,profit-maximizing firm hires workers up to the point where the

Correct AnswerverifiedShow Answer

In a representative labor market,

Correct AnswerverifiedShow Answer

Table 18-8 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 18-8.What is the marginal product of the third unit of labor?

Correct AnswerverifiedShow Answer

The term "factor market" applies to the market for

Correct AnswerverifiedShow Answer

Figure 18-6 -Refer to Figure 18-6.The graph above illustrates the market for bakers who make homemade breads and breakfast pastries.If the wages paid to wedding cake bakers decrease,what happens in the market for bread bakers?

Correct AnswerverifiedShow Answer

The basic tools of supply and demand apply to

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Typically,as a firm hires additional workers,the marginal product of labor

Correct AnswerverifiedShow Answer

Which of the following statements is correct? An individual worker's labor supply curve

Correct AnswerverifiedShow Answer

Immigration of workers into the United States is often an important source of

Correct AnswerverifiedShow Answer

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