Exam 16: Employment and Pricing of Inputs

Given that the rental rate of capital is $4,000 per month and the wage rate is $8,000 per month,what is the slope of the isocost line when labor is measured on the horizontal axis and capital on the vertical axis?

Suppose several industries compete for the available supply of a particular input.In a multi-industry market like this,which of the following statements about the input supply curve facing a single industry will be true?

The supply curve of labor to a competitive firm is:

For a monopsony buyer of labor,the marginal cost of hiring one more worker is:

A competitive firm in a competitive labor market faces the following conditions: Q = 12K^½L^½,with the market output price of $100 per unit and the market wage rate of $60 per unit of labor and a market rental price of capital of $100 per unit.How many units of capital should the firm use?

A competitive firm in a competitive labor market faces the following conditions: Q = 12K^½L^½,with the market output price of $100 per unit and the market wage rate of $60 per unit of labor and a market rental price of capital of $100 per unit.How many units of capital should the firm use?

The marginal value product of labor is equal to:

For a profit-maximizing firm that is a price taker in the output market and a wage taker in the Labor market,which of the following will be true?

Consider a firm's isocost line where labor is measured on the horizontal axis and capital on the vertical axis.If everything else is unchanged,a fall in the price of labor would:

Using a graph,show the welfare effects of a monopsony input market compared to a perfectly competitive input market.Assume upward sloping cost curves.

A profit-maximizing competitive firm will hire labor up to the point where _____.

Use the following table to answer the question : Table 16-1 : shows the total number of pizzas produced by 7 workers. -Refer to Table 16-1.Marginal product becomes negative from the _____ worker.

For which of the following is the supply curve of labor likely to be the most inelastic?

Two inputs,labor and capital,are considered complements if:

Use the following table to answer the question : Table 16-2 : shows the number of bread loaves that can be produced per hour at various levels of labor use.The bakery is a perfectly competitive firm. -Refer to Table 16-2.If the price of bread is $4 per loaf and the hourly wage rate is $12 per hour,how many workers will the profit-maximizing bakery hire?

Use the following figure to answer the question : Figure 16-1 :shows the isoquants,IQ₁ and IQ₂,for a competitive firm. -Refer to Figure 16-1.As compared to point B,the firm uses _____ at point A.

Given that w is the wage rate and MP_L is the marginal product of labor (the only variable input),w/MP_L shows:

Which of the following is true of a competitive industry's labor demand curve?

The input demand curve for an output market monopolist slopes downward because:

Answer the following: A firm faces total costs,C,price of capital,r,and price of labor,w. a)With capital (K)on the y-axis and labor (L)on the x-axis,graph a firm's optimal combination of inputs for producing Q₀ units of output. b)Decompose the total effect of a wage decrease into the substitution and output effects on the same graph.