Question 1

The value of marginal product of labour is the revenue

Accepted Answer

A) generated by selling an additional unit of output. 
B) needed to hire an additional unit of labour. 
C) generated by the employment of an additional unit of labour. 
D) needed to cover the cost of producing an additional unit of output. 
E) generated to cover the cost of hiring an extra unit of labour. 
A) generated by selling an additional unit of output. 
B) needed to hire an additional unit of labour. 
C) generated by the employment of an additional unit of labour. 
D) needed to cover the cost of producing an additional unit of output. 
E) generated to cover the cost of hiring an extra unit of labour. C

Question 2

Use the figure below to answer the following questions.
   Figure 18.3.1
-Refer to Figure 18.3.1.This figure shows the value of marginal product of labour curve,the labour supply curve,and the marginal cost of labour curve.If a union and the monopsonist in Figure 18.3.1 are equally strong,the outcome will be an hourly wage

Accepted Answer

A) of $7. 
B) between $5 and $6. 
C) between $5 and $7. 
D) between $6 and $7. 
E) of $6 
A) of $7. 
B) between $5 and $6. 
C) between $5 and $7. 
D) between $6 and $7. 
E) of $6 C

Question 3

Mr.Shaw has a small factory in Estevan Saskatchewan.He will continue hiring labour as long as the value of marginal product of labour ________ the wage rate.

Accepted Answer

A) is greater than 
B) is less than 
C) is less than or equal to 
D) determines 
E) maximizes 
A) is greater than 
B) is less than 
C) is less than or equal to 
D) determines 
E) maximizes A

Question 4

The demand for labour is a derived demand because it is derived from

Accepted Answer

A) the demand for the output the labour produces. 
B) the supply of labour. 
C) union pressure. 
D) natural law. 
E) years of accumulated capital and technological advances. 
A) the demand for the output the labour produces. 
B) the supply of labour. 
C) union pressure. 
D) natural law. 
E) years of accumulated capital and technological advances.

Question 5

A union is formed to restrict labour supply in a previously perfectly competitive labour market.If the union succeeds in raising the wage,

Accepted Answer

A) employment will fall. 
B) employment will rise. 
C) employment will not change. 
D) the total wage bill will rise. 
E) the total wage bill will fall. 
A) employment will fall. 
B) employment will rise. 
C) employment will not change. 
D) the total wage bill will rise. 
E) the total wage bill will fall.

Question 6

Suppose a profit-maximizing firm hires labour in a competitive labour market.If the value of marginal product of labour is greater than the wage rate,the firm should

Accepted Answer

A) increase the wage rate. 
B) decrease the wage rate. 
C) increase the quantity of labour it hires. 
D) decrease the quantity of labour it hires. 
E) shift to a more labour-intensive production process. 
A) increase the wage rate. 
B) decrease the wage rate. 
C) increase the quantity of labour it hires. 
D) decrease the quantity of labour it hires. 
E) shift to a more labour-intensive production process.

Question 7

During the past year,Teddy had a part-time job at which he is willing to work 30 hours each week.During Teddy's annual review,his boss grants him an 8 percent increase in his wage.As a result of the wage increase,Teddy is now willing to work 25 hours each week.Teddy's opportunity cost of ________ has risen and for Teddy the substitution effect of the wage hike is ________ the income effect.

Accepted Answer

A) leisure;less than 
B) leisure;more than 
C) labour;less than 
D) labour;more than 
E) leisure;equal to 
A) leisure;less than 
B) leisure;more than 
C) labour;less than 
D) labour;more than 
E) leisure;equal to

Question 8

Unions try to raise the demand for their labour by

Accepted Answer

A) raising wages. 
B) encouraging imports. 
C) supporting less restrictive immigration laws. 
D) sponsoring training for union members. 
E) lobbying against minimum wage laws. 
A) raising wages. 
B) encouraging imports. 
C) supporting less restrictive immigration laws. 
D) sponsoring training for union members. 
E) lobbying against minimum wage laws.

Question 9

If the rate of interest is 15 percent per year,the present value of the $200 to be received in two years is

Accepted Answer

A) $170.00. 
B) $185.00. 
C) $173.91. 
D) $264.50. 
E) $151.23. 
A) $170.00. 
B) $185.00. 
C) $173.91. 
D) $264.50. 
E) $151.23.

Question 10

The ________ of a future amount of money is the amount that,if invested today,will grow to be as large as that future amount when the interest it earns is taken into account.

Accepted Answer

A) current value 
B) future value 
C) present value 
D) market value 
E) profit value 
A) current value 
B) future value 
C) present value 
D) market value 
E) profit value

Question 11

An example of a nonrenewable natural resource is

Accepted Answer

A) oil. 
B) Lake Erie. 
C) rain. 
D) sunshine. 
E) the St.Lawrence River. 
A) oil. 
B) Lake Erie. 
C) rain. 
D) sunshine. 
E) the St.Lawrence River.

Question 12

A decrease in the price of a firm's output

Accepted Answer

A) decreases the supply of labour. 
B) increases the supply of labour. 
C) increases the value of marginal product of labour. 
D) decreases the quantity of labour demanded. 
E) decreases the value of marginal product of labour. 
A) decreases the supply of labour. 
B) increases the supply of labour. 
C) increases the value of marginal product of labour. 
D) decreases the quantity of labour demanded. 
E) decreases the value of marginal product of labour.

Question 13

Use the information below to answer the following questions.
Fact 18.5.1
The Burning Belly Taco Stand is considering buying some new special ovens.Each oven will cost $1,000,and will last for 2 years before it wears out.The ovens will be used to make the Taco Stands famous "Burning Ring of Fire" tacos,and will generate a value of marginal product of $600 for the first oven,$570 for the second oven,and $530 for the third oven.(Assume all revenues are earned at the end of the year. )
-Refer to Fact 18.5.1.If the rate of interest is 5 percent,how many ovens will the Burning Belly Taco Stand buy?

Accepted Answer

A) zero 
B) 1 
C) 2 
D) 3 
E) insufficient information to answer 
A) zero 
B) 1 
C) 2 
D) 3 
E) insufficient information to answer

Question 14

Use the table below to answer the following questions.
Table 18.2.2
Wendy owns an apple orchard and she employs students
to pick the apples.In an hour they can pick the following amounts:
 $$\begin{array}{l}
\text { Quantity of Apples }\
\begin{array} { c c } 
\text { Number of Students } & \text { (kilograms per hour) } \
1 & 20 \
2 & 50 \
3 & 90 \
4 & 120 \
5 & 145 \
6 & 165 \
7 & 180 \
8 & 190
\end{array}
\end{array}$$
-Refer to Table 18.2.2.If the price of apples is $0.50 per kilogram,the value of marginal product of the 5th student is

Accepted Answer

A) $0.50 an hour. 
B) $72.50 an hour. 
C) $14.50 an hour. 
D) $12.50 an hour. 
E) $10 an hour. 
A) $0.50 an hour. 
B) $72.50 an hour. 
C) $14.50 an hour. 
D) $12.50 an hour. 
E) $10 an hour.

Question 15

Complete the following sentence.A labour union is

Accepted Answer

A) an illegal conspiracy of workers formed to strike against employers. 
B) a legal organization of workers with a goal to overthrow the capitalist class. 
C) an organized group of workers that attempts to increase wages and influence other job conditions. 
D) an organized group of crime syndicates. 
E) a union with members working in the same industry,but in different jobs. 
A) an illegal conspiracy of workers formed to strike against employers. 
B) a legal organization of workers with a goal to overthrow the capitalist class. 
C) an organized group of workers that attempts to increase wages and influence other job conditions. 
D) an organized group of crime syndicates. 
E) a union with members working in the same industry,but in different jobs.

Question 16

To maximize profit,the firm must equate the

Accepted Answer

A) wage rate to the price of the good. 
B) wage rate to the marginal product of labour. 
C) value of marginal product to the factor price. 
D) marginal factor cost to the price of the output. 
E) marginal cost of the factor to the marginal product of the factor. 
A) wage rate to the price of the good. 
B) wage rate to the marginal product of labour. 
C) value of marginal product to the factor price. 
D) marginal factor cost to the price of the output. 
E) marginal cost of the factor to the marginal product of the factor.

Question 17

Use the figure below to answer the following questions.
   Figure 18.3.3
-Refer to Figure 18.3.3.Suppose the government passes a minimum wage law that prohibits anyone from hiring labour at less than $8 per hour.The monopsonist will hire

Accepted Answer

A) 250 hours of labour. 
B) 300 hours of labour. 
C) 350 hours of labour. 
D) 400 hours of labour. 
E) 450 hours of labour. 
A) 250 hours of labour. 
B) 300 hours of labour. 
C) 350 hours of labour. 
D) 400 hours of labour. 
E) 450 hours of labour.

Question 18

Profit is the factor price for

Accepted Answer

A) capital. 
B) land. 
C) entrepreneurship. 
D) labour. 
E) capital services. 
A) capital. 
B) land. 
C) entrepreneurship. 
D) labour. 
E) capital services.

Question 19

Use the figure below to answer the following questions.
   Figure 18.3.1
-Refer to Figure 18.3.1.This figure shows the value of marginal product of labour curve,the labour supply curve,and the marginal cost of labour curve.If this labour market is controlled by a monopsony,then the monopsonist hires

Accepted Answer

A) zero hours. 
B) 50 hours. 
C) 75 hours. 
D) 100 hours. 
E) greater than 100 hours. 
A) zero hours. 
B) 50 hours. 
C) 75 hours. 
D) 100 hours. 
E) greater than 100 hours.

Question 20

Suppose a gift shop in Corner Brook Newfoundland hires workers to personalize ornaments for Christmas.The store sells the personalized ornaments for $6 each.The value of marginal product of this store's fourth worker is $60.The marginal product of the fourth worker is

Accepted Answer

A) 6 ornaments. 
B) 10 ornaments. 
C) 60 ornaments. 
D) 360 ornaments. 
E) 90 ornaments. 
A) 6 ornaments. 
B) 10 ornaments. 
C) 60 ornaments. 
D) 360 ornaments. 
E) 90 ornaments.

The value of marginal product of labour is the revenue

Mr.Shaw has a small factory in Estevan Saskatchewan.He will continue hiring labour as long as the value of marginal product of labour ________ the wage rate.

The demand for labour is a derived demand because it is derived from

A union is formed to restrict labour supply in a previously perfectly competitive labour market.If the union succeeds in raising the wage,

Suppose a profit-maximizing firm hires labour in a competitive labour market.If the value of marginal product of labour is greater than the wage rate,the firm should

Unions try to raise the demand for their labour by

If the rate of interest is 15 percent per year,the present value of the $200 to be received in two years is

The ________ of a future amount of money is the amount that,if invested today,will grow to be as large as that future amount when the interest it earns is taken into account.

An example of a nonrenewable natural resource is

A decrease in the price of a firm's output

Complete the following sentence.A labour union is

To maximize profit,the firm must equate the

Use the figure below to answer the following questions. Figure 18.3.3 -Refer to Figure 18.3.3.Suppose the government passes a minimum wage law that prohibits anyone from hiring labour at less than $8 per hour.The monopsonist will hire

Profit is the factor price for

Use the figure below to answer the following questions. Figure 18.3.1 -Refer to Figure 18.3.1.This figure shows the value of marginal product of labour curve,the labour supply curve,and the marginal cost of labour curve.If this labour market is controlled by a monopsony,then the monopsonist hires

Suppose a gift shop in Corner Brook Newfoundland hires workers to personalize ornaments for Christmas.The store sells the personalized ornaments for $6 each.The value of marginal product of this store's fourth worker is $60.The marginal product of the fourth worker is

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities,preferences,and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Economic Inequality

Filters

Exam 18: Markets for Factors of Production

The value of marginal product of labour is the revenue

Mr.Shaw has a small factory in Estevan Saskatchewan.He will continue hiring labour as long as the value of marginal product of labour ________ the wage rate.

The demand for labour is a derived demand because it is derived from

A union is formed to restrict labour supply in a previously perfectly competitive labour market.If the union succeeds in raising the wage,

Suppose a profit-maximizing firm hires labour in a competitive labour market.If the value of marginal product of labour is greater than the wage rate,the firm should

Unions try to raise the demand for their labour by

If the rate of interest is 15 percent per year,the present value of the $200 to be received in two years is

The ________ of a future amount of money is the amount that,if invested today,will grow to be as large as that future amount when the interest it earns is taken into account.

An example of a nonrenewable natural resource is

A decrease in the price of a firm's output

Complete the following sentence.A labour union is

To maximize profit,the firm must equate the

Use the figure below to answer the following questions. Figure 18.3.3 -Refer to Figure 18.3.3.Suppose the government passes a minimum wage law that prohibits anyone from hiring labour at less than $8 per hour.The monopsonist will hire

Profit is the factor price for

Use the figure below to answer the following questions. Figure 18.3.1 -Refer to Figure 18.3.1.This figure shows the value of marginal product of labour curve,the labour supply curve,and the marginal cost of labour curve.If this labour market is controlled by a monopsony,then the monopsonist hires

Suppose a gift shop in Corner Brook Newfoundland hires workers to personalize ornaments for Christmas.The store sells the personalized ornaments for $6 each.The value of marginal product of this store's fourth worker is $60.The marginal product of the fourth worker is

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities,preferences,and Choices

Organizing Production

Output and Costs

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Economic Inequality

Filters