Question 1

A decrease in population can be expected to

Accepted Answer

A)   increase the marginal product of land.
B)   decrease the supply of land.
C)   decrease the rents on land.
D)   increase the demand for land.E) B) and D)
F) A) and D)

Question 2

The value of the marginal product of capital can be calculated as the market price of the good multiplied by the marginal product of capital.

Accepted Answer

A) True 
 B)False

Question 3

Suppose that a rare virus infects and kills a significant percentage of the population.Assuming that land and labor are complements in a farming production function,what would happen to the wages earned by workers and the rents earned by landowners?

Accepted Answer

A)   Both wages and rents would increase.
B)   Both wages and rents would decrease.
C)   Wages would increase, and rents would decrease.
D)   Wages would decrease, and rents would increase.E) A) and B)
F) A) and C)

Question 4

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) C) and D)
F) B) and C)

Question 5

Consider the market for land.Suppose the value of the marginal product of land decreases.Holding all else constant,the equilibrium rental price for land will

Accepted Answer

A)   increase.
B)   decrease.
C)   not change.
D)   It is not possible to determine what will happen to the equilibrium rental rate.E) None of the above
F) A) and B)

Question 6

If the demand curve for computer games shifts to the left,then the value of the marginal product of labor for computer game authors will

Accepted Answer

A)   rise.
B)   fall.
C)   remain unchanged.
D)   rise or fall; either is possible.E) A) and B)
F) A) and C)

Question 7

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) All of the above
F) A) and C)

Question 8

Oil field workers' wages are directly tied to the world price of oil.

Accepted Answer

A) True 
 B)False

Question 9

Consider the labor market for short-order cooks.A labor-augmenting technological change such as a faster food processor will cause

Accepted Answer

A)   both equilibrium wages and equilibrium employment to increase.
B)   both equilibrium wages and equilibrium employment to decrease.
C)   equilibrium wages to increase and equilibrium employment to decrease.
D)   equilibrium wages to decrease and equilibrium employment to increase.E) B) and D)
F) B) and C)

Question 10

Suppose that the market for labor is initially in equilibrium.Suppose that workers' tastes change so that they choose to retire at age 55 rather than age 67.Then the equilibrium wage

Accepted Answer

A)   and the equilibrium quantity of labor will rise.
B)   and the equilibrium quantity of labor will fall.
C)   will rise, and the equilibrium quantity of labor will fall.
D)   will fall, and the equilibrium quantity of labor will rise.E) C) and D)
F) None of the above

Question 11

Which of the following could increase the labor-supply curve for computer-repair technicians?

Accepted Answer

A)   an increase in the wages paid to computer-repair technicians
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)   an increase in the wages paid to television-repair techniciansE) A) and B)
F) A) and C)

Question 12

Ellen receives a raise at her current part-time job from $8 to $10 per hour.If her labor supply curve is upward sloping,she will work fewer hours after receiving the pay raise.

Accepted Answer

A) True 
 B)False

Question 13

Table 18-6
 
-Refer to Table 18-6.What is the value of the cell labeled GG?

Accepted Answer

A)   $400
B)   $100
C)   $0
D)     $$100 E) A) and B)
F) A) and C)

Question 14

The Black Death in fourteenth-century Europe resulted in

Accepted Answer

A)   a lower marginal product of land.
B)   a lower marginal product of labor of surviving workers.
C)   economic hardship for surviving peasants.
D)   economic prosperity for surviving landowners.E) None of the above
F) A) and B)

Question 15

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.Suppose that Harry pays each worker $80 per day and that he charges each customer $20 to have his driveway shoveled.What is the value of the marginal product of labor for the third worker?

Accepted Answer

A)   $160
B)   $640
C)   $1,600
D)   $2,400E) All of the above
F) B) and C)

Question 16

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

Accepted Answer

A)   8
B)   9
C)   10
D)   18E) All of the above
F) B) and D)

Question 17

An increase in the supply of labor has the effect of decreasing the

Accepted Answer

A)   wage.
B)   marginal product of labor.
C)   value of the marginal product of labor.
D)   All of the above are correct.E) A) and B)
F) B) and D)

Question 18

Daryn is raking leaves to earn money for his university's economics club.In the first hour,he rakes 8 bags of leaves.In the second hour,he rakes 6 bags of leaves.If he earns $8 per hour,the value of the marginal product of the second hour of labor is $16.

Accepted Answer

A) True 
 B)False

Question 19

Explain how a firm values the contribution of workers to its profitability.Would a profit-maximizing competitive firm ever stop increasing employment as long as marginal product is rising? Explain your answer.

Accepted Answer

A firm values the contribution of a work...

Question 20

The rental price of capital is determined by the

Accepted Answer

A)   forces of supply and demand in capital markets.
B)   amount of equity that is generated in equity markets.
C)   amount of bond financing used by profit-maximizing firms.
D)   amount of dividends paid out to stockholders by profit-maximizing firms.E) A) and B)
F) C) and D)

Exam 18: The Market For the Factors of Production.

Consider the market for land.Suppose the value of the marginal product of land decreases.Holding all else constant,the equilibrium rental price for land will

Correct Answer
verified

Daryn is raking leaves to earn money for his university's economics club.In the first hour,he rakes 8 bags of leaves.In the second hour,he rakes 6 bags of leaves.If he earns $8 per hour,the value of the marginal product of the second hour of labor is $16.

Correct Answer
verified

Oil field workers' wages are directly tied to the world price of oil.

Correct Answer
verified

The value of the marginal product of capital can be calculated as the market price of the good multiplied by the marginal product of capital.

Correct Answer
verified

A decrease in population can be expected to

Correct Answer
verified

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

Correct Answer
verified

Table 18-6 -Refer to Table 18-6.What is the value of the cell labeled GG?

Correct Answer
verified

An increase in the supply of labor has the effect of decreasing the

Correct Answer
verified

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

Which of the following could increase the labor-supply curve for computer-repair technicians?

Correct Answer
verified

The Black Death in fourteenth-century Europe resulted in

Correct Answer
verified

Consider the labor market for short-order cooks.A labor-augmenting technological change such as a faster food processor will cause

Correct Answer
verified

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

Correct Answer
verified

Explain how a firm values the contribution of workers to its profitability.Would a profit-maximizing competitive firm ever stop increasing employment as long as marginal product is rising? Explain your answer.

Correct Answer
verified
A firm values the contribution of a work...
View Answer

Suppose that the market for labor is initially in equilibrium.Suppose that workers' tastes change so that they choose to retire at age 55 rather than age 67.Then the equilibrium wage

Correct Answer
verified

Suppose that a rare virus infects and kills a significant percentage of the population.Assuming that land and labor are complements in a farming production function,what would happen to the wages earned by workers and the rents earned by landowners?

Correct Answer
verified

Correct Answer
verified

If the demand curve for computer games shifts to the left,then the value of the marginal product of labor for computer game authors will

Correct Answer
verified

The rental price of capital is determined by the

Correct Answer
verified

Ellen receives a raise at her current part-time job from $8 to $10 per hour.If her labor supply curve is upward sloping,she will work fewer hours after receiving the pay raise.

Correct Answer
verified

Exam 18: The Market For the Factors of Production.

Consider the market for land.Suppose the value of the marginal product of land decreases.Holding all else constant,the equilibrium rental price for land will

Correct AnswerverifiedShow Answer

Daryn is raking leaves to earn money for his university's economics club.In the first hour,he rakes 8 bags of leaves.In the second hour,he rakes 6 bags of leaves.If he earns $8 per hour,the value of the marginal product of the second hour of labor is $16.

Correct AnswerverifiedShow Answer

Oil field workers' wages are directly tied to the world price of oil.

Correct AnswerverifiedShow Answer

The value of the marginal product of capital can be calculated as the market price of the good multiplied by the marginal product of capital.

Correct AnswerverifiedShow Answer

A decrease in population can be expected to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Table 18-6 -Refer to Table 18-6.What is the value of the cell labeled GG?

Correct AnswerverifiedShow Answer

An increase in the supply of labor has the effect of decreasing the

Correct AnswerverifiedShow 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

Which of the following could increase the labor-supply curve for computer-repair technicians?

Correct AnswerverifiedShow Answer

The Black Death in fourteenth-century Europe resulted in

Correct AnswerverifiedShow Answer

Consider the labor market for short-order cooks.A labor-augmenting technological change such as a faster food processor will cause

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Explain how a firm values the contribution of workers to its profitability.Would a profit-maximizing competitive firm ever stop increasing employment as long as marginal product is rising? Explain your answer.

Correct AnswerverifiedA firm values the contribution of a work...View AnswerShow Answer

Suppose that the market for labor is initially in equilibrium.Suppose that workers' tastes change so that they choose to retire at age 55 rather than age 67.Then the equilibrium wage

Correct AnswerverifiedShow Answer

Suppose that a rare virus infects and kills a significant percentage of the population.Assuming that land and labor are complements in a farming production function,what would happen to the wages earned by workers and the rents earned by landowners?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If the demand curve for computer games shifts to the left,then the value of the marginal product of labor for computer game authors will

Correct AnswerverifiedShow Answer

The rental price of capital is determined by the

Correct AnswerverifiedShow Answer

Ellen receives a raise at her current part-time job from $8 to $10 per hour.If her labor supply curve is upward sloping,she will work fewer hours after receiving the pay raise.

Correct AnswerverifiedShow Answer

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A firm values the contribution of a work...
View Answer

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Correct Answer
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Correct Answer
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Correct Answer
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