Question 1

Which of the following will make the labor demand curve shift to the right?

Accepted Answer

A)  a decrease in price 
B)  an increase in labor force 
C)  an increase in productivity 
D)  all of the above 
A)  a decrease in price 
B)  an increase in labor force 
C)  an increase in productivity 
D)  all of the above

Question 2

A firm's short-run demand curve for labor is

Accepted Answer

A)  upward sloping. 
B)  the marginal revenue product curve. 
C)  the downward-sloping portion of the marginal cost curve. 
D)  the marginal cost divided by price. 
A)  upward sloping. 
B)  the marginal revenue product curve. 
C)  the downward-sloping portion of the marginal cost curve. 
D)  the marginal cost divided by price.

Question 3

The demand for labor is more inelastic in the short run.This makes the short-run demand curve steeper compared to the long-run demand curve.

Accepted Answer

A) True 
 B)False

Question 4

Explain why long-run labor demand curves slope downward using the concepts of the input-substitution effect and the output effect.

Accepted Answer

When the price of labor increases,the fi

Question 5

Compared to its long-run demand for labor,a firm's short-run labor demand curve

Accepted Answer

A)  is flatter. 
B)  will be relatively more inelastic. 
C)  will be relatively more elastic. 
D)  none of the above 
A)  is flatter. 
B)  will be relatively more inelastic. 
C)  will be relatively more elastic. 
D)  none of the above

Question 6

Recall the Application about how physical attractiveness affects wages to answer the following question(s).
-Recall the Application.Which of the following is a factor in the beauty premium?

Accepted Answer

A)  Some workers and customers like dealing with attractive people. 
B)  Beautiful people get more opportunities to learn through experience. 
C)  Attractive people demand higher wages because of their greater potential. 
D)  Both A and B are correct. 
A)  Some workers and customers like dealing with attractive people. 
B)  Beautiful people get more opportunities to learn through experience. 
C)  Attractive people demand higher wages because of their greater potential. 
D)  Both A and B are correct.

Question 7

Table 17.6
-A soft pretzel shop can sell as many pretzels as it wishes at a price of $2.The production information is shown in Table 17.6.If the shop must pay $60 per worker per day,how many workers should be hired to maximize profit?

Accepted Answer

The firm will hire workers unt

Question 8

Recall the Application about who benefits from the immigration of low-skilled workers to the United States to answer the following question(s).
-Recall the Application.Which of the following is NOT a result of immigrant labor in the United States?

Accepted Answer

A)  lower prices of products 
B)  lower costs of production 
C)  increased wages for low-skilled workers 
D)  increased benefits to consumers 
A)  lower prices of products 
B)  lower costs of production 
C)  increased wages for low-skilled workers 
D)  increased benefits to consumers

Question 9

What expenditure makes up approximately half of total expenditures on means-tested programs?

Accepted Answer

A)  education 
B)  housing aid 
C)  medical care 
D)  all of the above 
A)  education 
B)  housing aid 
C)  medical care 
D)  all of the above

Question 10

Which of the following could lead to an increase in labor supply?

Accepted Answer

A)  an increase in immigration 
B)  a decrease in the marginal product of workers 
C)  an increase in the wage rate 
D)  none of the above 
A)  an increase in immigration 
B)  a decrease in the marginal product of workers 
C)  an increase in the wage rate 
D)  none of the above

Question 11

Table 17.4
-Refer to Table 17.4.Suppose the wage rate equals $8 per worker.How many workers will the firm hire?

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  There is not enough information to tell. 
A)  2 
B)  3 
C)  4 
D)  There is not enough information to tell.

Question 12

The additional output produced by hiring an additional unit of labor is known as

Accepted Answer

A)  the productivity of labor. 
B)  the marginal product of labor. 
C)  diminishing returns. 
D)  the derived demand for labor. 
A)  the productivity of labor. 
B)  the marginal product of labor. 
C)  diminishing returns. 
D)  the derived demand for labor.

Question 13

Since there are diminishing returns in the long run,the market demand curve is negatively sloped.

Accepted Answer

A) True 
 B)False

Question 14

A reason for the increase in demand for workers with high levels of labor skills is

Accepted Answer

A)  greater taxes paid on income earned. 
B)  increased technological advances. 
C)  reduced international trade from protectionism. 
D)  Both B and C are correct. 
A)  greater taxes paid on income earned. 
B)  increased technological advances. 
C)  reduced international trade from protectionism. 
D)  Both B and C are correct.

Question 15

-Refer to Figure 17.2.If the hourly wage increases from $9 to $12,then

Accepted Answer

A)  quantity demanded for labor will rise. 
B)  demand for labor will decrease. 
C)  quantity supplied of labor will increase. 
D)  supply of labor will fall. 
A)  quantity demanded for labor will rise. 
B)  demand for labor will decrease. 
C)  quantity supplied of labor will increase. 
D)  supply of labor will fall.

Question 16

Which one of the following groups had the lowest incidence of poverty in 2010?

Accepted Answer

A)  married couples 
B)  Asian households 
C)  65 years of age and older 
D)  female-headed households 
A)  married couples 
B)  Asian households 
C)  65 years of age and older 
D)  female-headed households

Question 17

If the market wage rate is below equilibrium,there will be a surplus of workers.

Accepted Answer

A) True 
 B)False

Question 18

An appliance manufacturer adopts a new technology that,ceteris paribus,increases the productivity of capital.At the same time,its employees unionize and demand higher wages.Assume that for this manufacturer capital and labor are substitutable.Which of the following is most likely to occur?

Accepted Answer

A)  Capital will be substituted for labor. 
B)  Labor will be substituted for capital. 
C)  Output increases as do the prices of capital and labor. 
D)  Output decreases as does the price of cars. 
A)  Capital will be substituted for labor. 
B)  Labor will be substituted for capital. 
C)  Output increases as do the prices of capital and labor. 
D)  Output decreases as does the price of cars.

Question 19

Table 17.1
-Refer to Table 17.1.If the product sells at a market price of $3,the marginal revenue product of the fourth worker is

Accepted Answer

A)  $60. 
B)  $40. 
C)  $15. 
D)  $10. 
A)  $60. 
B)  $40. 
C)  $15. 
D)  $10.

Question 20

Table 17.3
-Refer to Table 17.3.Suppose that the market price of the product is $2.If the wage is $40,the firm should hire ________ workers.

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  5 
A)  2 
B)  3 
C)  4 
D)  5

Which of the following will make the labor demand curve shift to the right?

A firm's short-run demand curve for labor is

The demand for labor is more inelastic in the short run.This makes the short-run demand curve steeper compared to the long-run demand curve.

Explain why long-run labor demand curves slope downward using the concepts of the input-substitution effect and the output effect.

Compared to its long-run demand for labor,a firm's short-run labor demand curve

Recall the Application about how physical attractiveness affects wages to answer the following question(s). -Recall the Application.Which of the following is a factor in the beauty premium?

Table 17.6 -A soft pretzel shop can sell as many pretzels as it wishes at a price of $2.The production information is shown in Table 17.6.If the shop must pay $60 per worker per day,how many workers should be hired to maximize profit?

Recall the Application about who benefits from the immigration of low-skilled workers to the United States to answer the following question(s). -Recall the Application.Which of the following is NOT a result of immigrant labor in the United States?

What expenditure makes up approximately half of total expenditures on means-tested programs?

Which of the following could lead to an increase in labor supply?

Table 17.4 -Refer to Table 17.4.Suppose the wage rate equals $8 per worker.How many workers will the firm hire?

The additional output produced by hiring an additional unit of labor is known as

Since there are diminishing returns in the long run,the market demand curve is negatively sloped.

A reason for the increase in demand for workers with high levels of labor skills is

-Refer to Figure 17.2.If the hourly wage increases from $9 to $12,then

Which one of the following groups had the lowest incidence of poverty in 2010?

If the market wage rate is below equilibrium,there will be a surplus of workers.

An appliance manufacturer adopts a new technology that,ceteris paribus,increases the productivity of capital.At the same time,its employees unionize and demand higher wages.Assume that for this manufacturer capital and labor are substitutable.Which of the following is most likely to occur?

Table 17.1 -Refer to Table 17.1.If the product sells at a market price of $3,the marginal revenue product of the fourth worker is

Table 17.3 -Refer to Table 17.3.Suppose that the market price of the product is $2.If the wage is $40,the firm should hire ________ workers.

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

International Trade and Public Policy

Filters

Exam 17: The Labor Market and the Distribution of Income

Which of the following will make the labor demand curve shift to the right?

A firm's short-run demand curve for labor is

The demand for labor is more inelastic in the short run.This makes the short-run demand curve steeper compared to the long-run demand curve.

Explain why long-run labor demand curves slope downward using the concepts of the input-substitution effect and the output effect.

Compared to its long-run demand for labor,a firm's short-run labor demand curve

Recall the Application about how physical attractiveness affects wages to answer the following question(s). -Recall the Application.Which of the following is a factor in the beauty premium?

Table 17.6 -A soft pretzel shop can sell as many pretzels as it wishes at a price of $2.The production information is shown in Table 17.6.If the shop must pay $60 per worker per day,how many workers should be hired to maximize profit?

Recall the Application about who benefits from the immigration of low-skilled workers to the United States to answer the following question(s). -Recall the Application.Which of the following is NOT a result of immigrant labor in the United States?

What expenditure makes up approximately half of total expenditures on means-tested programs?

Which of the following could lead to an increase in labor supply?

Table 17.4 -Refer to Table 17.4.Suppose the wage rate equals $8 per worker.How many workers will the firm hire?

The additional output produced by hiring an additional unit of labor is known as

Since there are diminishing returns in the long run,the market demand curve is negatively sloped.

A reason for the increase in demand for workers with high levels of labor skills is

-Refer to Figure 17.2.If the hourly wage increases from $9 to $12,then

Which one of the following groups had the lowest incidence of poverty in 2010?

If the market wage rate is below equilibrium,there will be a surplus of workers.

An appliance manufacturer adopts a new technology that,ceteris paribus,increases the productivity of capital.At the same time,its employees unionize and demand higher wages.Assume that for this manufacturer capital and labor are substitutable.Which of the following is most likely to occur?

Table 17.1 -Refer to Table 17.1.If the product sells at a market price of $3,the marginal revenue product of the fourth worker is

Table 17.3 -Refer to Table 17.3.Suppose that the market price of the product is $2.If the wage is $40,the firm should hire ________ workers.

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand,supply,and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Production Technology and Cost

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

International Trade and Public Policy

Filters