Exam 19: Factor Markets and the Distribution of Income

(Table: Value of the Marginal Product of Labor and Demand) In the figure Value of the Marginal Product of Labor and Demand, the total product of labor is shown for the hourly production of power cords.The price of a power cord is $2, the market wage rate is $40 per hour, and eight workers are hired.Profit can be maximized by hiring worker(s).

In a perfectly competitive labor market, the equilibrium wage in the industry:

A small college employs two economists.Rob has been employed by the college for 15 years, and Nasrin has been employed for one year.Rob's salary is significantly higher than Nasrin's, despite the fact that he and she both have their doctoral degrees in economics.Each professor averages one publication per year, and both are excellent teachers.Given this information, the wage difference is best explained by:

The marginal productivity theory of income distribution says that:

A firm's demand curve for labor is:

In the United States in the early years of the twenty-first century, approximately _ of total income in the economy took the form of compensation of employees.

(Table: Value of the Marginal Product of Labor and Demand) In the figure Value of the Marginal Product of Labor and Demand, the total product of labor is shown for the hourly production of power cords.The price of a power cord is $2, the market wage rate is $20 per hour, and eight workers are hired.Profit can be maximized by hiring worker(s).

An important assumption underlying the marginal productivity theory of income distribution is that:

The Bountiful Bakery is considering hiring another pastry chef.The bakery knows the average product of its chefs is 15 dozen croissants per day.It also believes that the next chef hired will produce an extra 12 dozen croissants per day.A dozen croissants sell for $30.The bakery should hire another worker:

A new teacher often makes less than a teacher with 20 years' experience because of:

The amount by which the use of an additional unit of a factor of production increases a firm's total revenue during a period is called the:

Which of the following statements about unions is true?

(Table: Employment and Output) In the table Employment and Output, if the price of a bushel of wheat is $10, then the value of the marginal product of the fifth worker is:

Suppose all perfectly competitive construction firms are hiring the profit-maximizing quantity of labor and capital and are paying their workers $5 per hour.The government imposes a minimum wage of $6 per hour.Then:

A leftward shift in the labor supply curve might result from which of the following?

If the extra output that is produced by hiring one more unit of labor adds more to _ than to ________, the firm will increase its profit by increasing the use of labor.

(Table: Value of the Marginal Product of Labor and Demand) In the figure Value of the Marginal Product of Labor and Demand, the total product of labor is shown for the hourly production of power cords.If the price of a power cord is $2 and the market wage rate is $20 per hour, the profit-maximizing quantity of labor is __ workers.

The category "compensation of employees" doesn't capture the full income of labor because:

(Table: Value of the Marginal Product of Labor and Demand) In the figure Value of the Marginal Product of Labor and Demand, the total product of labor is shown for the hourly production of power cords.If the price of a power cord is $2, the value of the marginal product for the third worker is:

A leftward shift in the labor supply curve will result if: