Question 1

Other things being equal,which of the following would increase the market demand for labor?

Accepted Answer

A) A fall in the wage rate. 
B) An increase in the marginal productivity of labor. 
C) A decrease in the cost-effectiveness of labor relative to other inputs. 
A) A fall in the wage rate. 
B) An increase in the marginal productivity of labor. 
C) A decrease in the cost-effectiveness of labor relative to other inputs.

Question 2

If Sara's elasticity of labor supply is 1.5 and she increases her supply of labor by 5 percent,then the wage rate must have

Accepted Answer

A) Increased by 3.3 percent. 
B) Increased by 3.0 percent. 
C) Increased by 7.5 percent. 
A) Increased by 3.3 percent. 
B) Increased by 3.0 percent. 
C) Increased by 7.5 percent.

Question 3

Despite the probable decrease in jobs and higher prices,President Obama wanted to increase the federal minimum wage.

Accepted Answer

A) True 
 B)False

Question 4

Institutional constraints,such as immigration policies,affect the shape and location of the labor supply curve.

Accepted Answer

A) True 
 B)False

Question 5

Democrats argue that labor demand is _______,so ________ jobs will be lost when the minimum wage is raised.

Accepted Answer

A) inelastic;few 
B) inelastic;many 
C) elastic;few 
A) inelastic;few 
B) inelastic;many 
C) elastic;few

Question 6

-In Figure 30.2,a minimum wage of $20 will result in a

Accepted Answer

A) Shortage of 160 workers. 
B) Shortage of 180 hours. 
C) Surplus of 32 workers. 
A) Shortage of 160 workers. 
B) Shortage of 180 hours. 
C) Surplus of 32 workers.

Question 7

Cost efficiency is achieved when the MPP of a worker relative to the worker's wage is the same for all workers.

Accepted Answer

A) True 
 B)False

Question 8

-Assume that the product price is $4 per unit and that the hourly wage for workers is $12.Neither price nor wage changes with output.In Table 30.1,the marginal revenue product of the second worker hired is

Accepted Answer

A) $4 per hour. 
B) $6 per hour. 
C) $24 per hour. 
A) $4 per hour. 
B) $6 per hour. 
C) $24 per hour.

Question 9

A firm should hire an additional worker as long as the wage rate is

Accepted Answer

A) Greater than the MRP. 
B) Greater than the MPP. 
C) Less than the MRP. 
A) Greater than the MRP. 
B) Greater than the MPP. 
C) Less than the MRP.

Question 10

In competitive markets,the marginal revenue product curve and marginal physical product curve have similar shapes because

Accepted Answer

A) The demand curve for the product slopes downward in accordance with the law of diminishing returns. 
B) MRP = P × MPP. 
C) The law of diminishing marginal utility and the law of diminishing returns imply a downward-sloping demand curve in the product market. 
A) The demand curve for the product slopes downward in accordance with the law of diminishing returns. 
B) MRP = P × MPP. 
C) The law of diminishing marginal utility and the law of diminishing returns imply a downward-sloping demand curve in the product market.

Question 11

One In the News article is titled "Challenging Work and Corporate Responsibility Will Lure MBA Grads." In the headline,which of the following determinants of labor supply is most explicitly mentioned?

Accepted Answer

A) Tastes. 
B) Taxes. 
C) Prices of consumer goods. 
A) Tastes. 
B) Taxes. 
C) Prices of consumer goods.

Question 12

The determinants of labor demand include

Accepted Answer

A) Marginal physical productivity. 
B) Labor expectations. 
C) Labor shortages. 
A) Marginal physical productivity. 
B) Labor expectations. 
C) Labor shortages.

Question 13

Explain the concept of a backward-bending labor supply curve.

Accepted Answer

As wage rates climb,the substi

Question 14

- Table 30.2 shows how many hairstyling appointments a hair salon can schedule per week based on the number of stylists.In the spaces provided,compute the marginal physical product (MPP)of the hair stylists,total revenue,and marginal revenue product of the stylists,assuming that a hair stylist charges $60 per appointment.In Table 30.2,as more stylists are hired,

Accepted Answer

A) There are diminishing returns. 
B) There are economies of scale. 
C) There are diseconomies of scale. 
A) There are diminishing returns. 
B) There are economies of scale. 
C) There are diseconomies of scale.

Question 15

Why is the demand curve for labor downward-sloping? What causes the labor demand curve for a firm to shift?

Accepted Answer

The marginal revenue product curve is th

Question 16

If payroll taxes are increased,there will be a

Accepted Answer

A) Leftward shift of the labor supply curve. 
B) Rightward shift of the labor supply curve. 
C) Movement up the labor supply curve to the right. 
A) Leftward shift of the labor supply curve. 
B) Rightward shift of the labor supply curve. 
C) Movement up the labor supply curve to the right.

Question 17

If the cost efficiency of labor equals 2,then

Accepted Answer

A) Labor costs 100 percent more than the revenue it generates. 
B) The wage rate is 100 percent more than the product price. 
C) Each extra dollar spent on wages returns 2 units of additional output. 
A) Labor costs 100 percent more than the revenue it generates. 
B) The wage rate is 100 percent more than the product price. 
C) Each extra dollar spent on wages returns 2 units of additional output.

Exam 30: The Labor Market

Other things being equal,which of the following would increase the market demand for labor?

If Sara's elasticity of labor supply is 1.5 and she increases her supply of labor by 5 percent,then the wage rate must have

Despite the probable decrease in jobs and higher prices,President Obama wanted to increase the federal minimum wage.

Institutional constraints,such as immigration policies,affect the shape and location of the labor supply curve.

Democrats argue that labor demand is _______,so ________ jobs will be lost when the minimum wage is raised.

-In Figure 30.2,a minimum wage of $20 will result in a

Cost efficiency is achieved when the MPP of a worker relative to the worker's wage is the same for all workers.

-Assume that the product price is $4 per unit and that the hourly wage for workers is $12.Neither price nor wage changes with output.In Table 30.1,the marginal revenue product of the second worker hired is

A firm should hire an additional worker as long as the wage rate is

In competitive markets,the marginal revenue product curve and marginal physical product curve have similar shapes because

One In the News article is titled "Challenging Work and Corporate Responsibility Will Lure MBA Grads." In the headline,which of the following determinants of labor supply is most explicitly mentioned?

The determinants of labor demand include

Explain the concept of a backward-bending labor supply curve.

Why is the demand curve for labor downward-sloping? What causes the labor demand curve for a firm to shift?

If payroll taxes are increased,there will be a

If the cost efficiency of labor equals 2,then

Economics: the Core Issues Appendix: Using Graphs

The Us Economy: a Global View

Supply and Demand

The Role of Government

National Income Accounting

Unemployment

Inflation

The Business Cycle

Aggregate Demand Appendix: the Keynesian Cross

Self-Adjustment or Instability

Fiscal Policy

Deficits and Debt

Money and Banks

The Federal Reserve System

Monetary Policy

Supply-Side Policy: Short-Run Options

Growth and Productivity: Long-Run Possibilities

Theory Versus Reality

Consumer Choice Appendix: Indifference Curves

Elasticity

The Costs of Production

The Competitive Firm

Competitive Markets

Monopoly

Oligopoly

Monopolistic Competition

Natural Monopolies: Deregulation

Environmental Protection

The Farm Problem

Labor Unions

Financial Markets

Taxes: Equity Versus Efficiency

Transfer Payments: Welfare and Social Security

International Trade

International Finance

Global Poverty Glossary Index Reference Tables

Filters

Democrats argue that labor demand is _,so __ jobs will be lost when the minimum wage is raised.