Question 1

If the demand for labour is unchanged,an increase in the supply of labour will lead to

Accepted Answer

A) a decrease in the quantity of labour demanded and a decrease in the equilibrium wage. 
B) an increase in the quantity of labour demanded and a decrease in the equilibrium wage. 
C) an increase in the quantity of labour demanded and an increase in the equilibrium wage. 
D) a decrease in the quantity of labour demanded and an increase in the equilibrium wage. 
A) a decrease in the quantity of labour demanded and a decrease in the equilibrium wage. 
B) an increase in the quantity of labour demanded and a decrease in the equilibrium wage. 
C) an increase in the quantity of labour demanded and an increase in the equilibrium wage. 
D) a decrease in the quantity of labour demanded and an increase in the equilibrium wage.

Question 2

If the labour supply is unchanged,an increase in the demand for labour will

Accepted Answer

A) increase the equilibrium wage and decrease the number of workers employed. 
B) increase the equilibrium wage and increase the quantity of jobs demanded. 
C) decrease the equilibrium wage and increase the number of workers employed. 
D) increase the equilibrium wage and increase the number of workers employed. 
A) increase the equilibrium wage and decrease the number of workers employed. 
B) increase the equilibrium wage and increase the quantity of jobs demanded. 
C) decrease the equilibrium wage and increase the number of workers employed. 
D) increase the equilibrium wage and increase the number of workers employed.

Question 3

Worker discrimination occurs when

Accepted Answer

A) workers refuse to perform risky tasks. 
B) workers refuse to work with persons of a different race. 
C) customers refuse to buy products produced by a racially diverse workforce. 
D) employers pay different employees different wages based on race. 
A) workers refuse to perform risky tasks. 
B) workers refuse to work with persons of a different race. 
C) customers refuse to buy products produced by a racially diverse workforce. 
D) employers pay different employees different wages based on race.

Question 4

A decrease in the amount of human capital acquired by workers will lead to decrease in the supply of labour.

Accepted Answer

A) True 
 B)False

Question 5

Paying a person a lower wage or excluding a person from an occupation on the basis of an irrelevant characteristic such as race or gender

Accepted Answer

A) is economic discrimination. 
B) violates federal comparable worth laws. 
C) can be explained by negative feedback loops. 
D) creates differences in wages that economists call 'compensating differentials.' 
A) is economic discrimination. 
B) violates federal comparable worth laws. 
C) can be explained by negative feedback loops. 
D) creates differences in wages that economists call 'compensating differentials.'

Question 6

Figure 12-2  
 Figure 12-2 shows the marginal revenue product for Becca's Baubles,a producer of hand-beaded bracelets.
-Refer to Figure 12-2.If the wage rate is $20,how many workers should Becca hire?

Accepted Answer

A) 6 
B) 5 
C) 4 
D) 3 
A) 6 
B) 5 
C) 4 
D) 3

Question 7

What is the difference between 'straight-time pay,' 'commission pay,' and 'piece-rate pay'?

Accepted Answer

Straight-time pay refers to pa

Question 8

Seth's grandmother gave him a $50 savings bond for his birthday.The bond pays $50 at maturity,which is in five years.If the interest rate is 5%,the bond has a present value of $43.19.

Accepted Answer

A) True 
 B)False

Question 9

Serafina was earning $75 per hour and working 50 hours per week.Serafina's wage rose to $90 per hour,and as a result,she now works 60 hours per week.What can you conclude from this information about the income effect and the substitution effect of a wage change for Serafina?

Accepted Answer

We can conclude that Serafina's substitu

Question 10

Compared to a competitive market,a firm that has a monopsony in a labour market would

Accepted Answer

A) hire fewer workers and pay higher wages. 
B) hire more workers and pay lower wages. 
C) hire fewer workers and pay lower wages. 
D) hire more workers and pay higher wages. 
A) hire fewer workers and pay higher wages. 
B) hire more workers and pay lower wages. 
C) hire fewer workers and pay lower wages. 
D) hire more workers and pay higher wages.

Question 11

An individual's labour supply curve shows

Accepted Answer

A) the maximum wage rates offered to that individual by various potential employers. 
B) the relationship between wages and the quantity of labour that she is willing to supply. 
C) the relationship between wages and the quantity of labour that a firm is willing to employ. 
D) the relationship between the quantity of hours worked and total income earned by that individual. 
A) the maximum wage rates offered to that individual by various potential employers. 
B) the relationship between wages and the quantity of labour that she is willing to supply. 
C) the relationship between wages and the quantity of labour that a firm is willing to employ. 
D) the relationship between the quantity of hours worked and total income earned by that individual.

Question 12

A monopsony is a term used to refer to a firm that is the sole seller of a good or service.

Accepted Answer

A) True 
 B)False

Question 13

Table 12-5
  
-Refer to Table 12-5.Dante owns a pencil factory and faces the situation shown in the table,and the cost of renting a machine is $240 per week.
a.Fill in the blanks in the table and determine the profit-maximising number of machines for Dante to rent.Explain why renting this number of machines is profit maximising.
b.Draw Dante's demand curve for capital.

Accepted Answer

@#IMG-DLM& 
a.Dante should rent 4 machin

Question 14

Most economists believe that only a small gap between the wages of white males and the wages of other groups is due to education.Most of the gap is explained by discrimination.

Accepted Answer

A) True 
 B)False

Question 15

The change in a firm's revenue as a result of hiring one more worker

Accepted Answer

A) is the definition of the marginal product of labour. 
B) is equal to the firm's marginal cost. 
C) is the definition of the marginal revenue product of labour. 
D) will be negative if the demand for the firm's output is inelastic. 
A) is the definition of the marginal product of labour. 
B) is equal to the firm's marginal cost. 
C) is the definition of the marginal revenue product of labour. 
D) will be negative if the demand for the firm's output is inelastic.

Question 16

The income effect of a wage increase will cause a worker to devote

Accepted Answer

A) more time to labour and more time to leisure. 
B) more time to labour and less time to leisure. 
C) less time to labour and more time to leisure. 
D) less time to labour and less time to leisure. 
A) more time to labour and more time to leisure. 
B) more time to labour and less time to leisure. 
C) less time to labour and more time to leisure. 
D) less time to labour and less time to leisure.

Question 17

The demand for labour is described as a derived demand because

Accepted Answer

A) it is derived by workers seeking to earn income to fund the consumption of goods and services. 
B) it is derived by producers seeking to make profits by starting new businesses. 
C) it is derived from the demand for products that use labour in the production process. 
D) it is derived from government institutions which rely on labour markets for the purpose of raising tax revenue. 
A) it is derived by workers seeking to earn income to fund the consumption of goods and services. 
B) it is derived by producers seeking to make profits by starting new businesses. 
C) it is derived from the demand for products that use labour in the production process. 
D) it is derived from government institutions which rely on labour markets for the purpose of raising tax revenue.

Question 18

If it is difficult for a firm to attribute the output it produces to a particular worker,then

Accepted Answer

A) its employees are likely to form a union. 
B) a commission system of compensation will be preferable to a salary system. 
C) a salary compensation system will be preferable to a commission system. 
D) a piece-rate system of compensation will be preferable to a salary system. 
A) its employees are likely to form a union. 
B) a commission system of compensation will be preferable to a salary system. 
C) a salary compensation system will be preferable to a commission system. 
D) a piece-rate system of compensation will be preferable to a salary system.

Question 19

Which of the following variables will not cause the market supply curve of labour to shift?

Accepted Answer

A) increases in population 
B) a favourable change in consumer tastes 
C) a change in the labour participation rate of women 
D) an increase in the number of people between the ages of 16 and 65 
A) increases in population 
B) a favourable change in consumer tastes 
C) a change in the labour participation rate of women 
D) an increase in the number of people between the ages of 16 and 65

Question 20

Marginal revenue product falls as more labour is hired because

Accepted Answer

A) the price of the product must fall for a perfectly competitive firm to sell more. 
B) the wage rate rises as more workers work more hours. 
C) the marginal product of labour is negative as additional units of labour are hired. 
D) the marginal product of labour falls as a result of the law of diminishing returns. 
A) the price of the product must fall for a perfectly competitive firm to sell more. 
B) the wage rate rises as more workers work more hours. 
C) the marginal product of labour is negative as additional units of labour are hired. 
D) the marginal product of labour falls as a result of the law of diminishing returns.

If the demand for labour is unchanged,an increase in the supply of labour will lead to

If the labour supply is unchanged,an increase in the demand for labour will

Worker discrimination occurs when

A decrease in the amount of human capital acquired by workers will lead to decrease in the supply of labour.

Paying a person a lower wage or excluding a person from an occupation on the basis of an irrelevant characteristic such as race or gender

Figure 12-2 Figure 12-2 shows the marginal revenue product for Becca's Baubles,a producer of hand-beaded bracelets. -Refer to Figure 12-2.If the wage rate is $20,how many workers should Becca hire?

What is the difference between 'straight-time pay,' 'commission pay,' and 'piece-rate pay'?

Seth's grandmother gave him a $50 savings bond for his birthday.The bond pays $50 at maturity,which is in five years.If the interest rate is 5%,the bond has a present value of $43.19.

Serafina was earning $75 per hour and working 50 hours per week.Serafina's wage rose to $90 per hour,and as a result,she now works 60 hours per week.What can you conclude from this information about the income effect and the substitution effect of a wage change for Serafina?

Compared to a competitive market,a firm that has a monopsony in a labour market would

An individual's labour supply curve shows

A monopsony is a term used to refer to a firm that is the sole seller of a good or service.

Most economists believe that only a small gap between the wages of white males and the wages of other groups is due to education.Most of the gap is explained by discrimination.

The change in a firm's revenue as a result of hiring one more worker

The income effect of a wage increase will cause a worker to devote

The demand for labour is described as a derived demand because

If it is difficult for a firm to attribute the output it produces to a particular worker,then

Which of the following variables will not cause the market supply curve of labour to shift?

Marginal revenue product falls as more labour is hired because

Economics: Foundations and Models

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: the Responsiveness of Demand and Supply

Economic Efficiency, Government Price Setting and Taxes

Consumer Choice and Behavioural Economics

Technology, Production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition

Oligopoly: Firms in Less Competitive Markets

International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

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Exam 12: The Markets for Labour and Other Factors of Production

If the demand for labour is unchanged,an increase in the supply of labour will lead to

If the labour supply is unchanged,an increase in the demand for labour will

Worker discrimination occurs when

A decrease in the amount of human capital acquired by workers will lead to decrease in the supply of labour.

Paying a person a lower wage or excluding a person from an occupation on the basis of an irrelevant characteristic such as race or gender

Figure 12-2 Figure 12-2 shows the marginal revenue product for Becca's Baubles,a producer of hand-beaded bracelets. -Refer to Figure 12-2.If the wage rate is $20,how many workers should Becca hire?

What is the difference between 'straight-time pay,' 'commission pay,' and 'piece-rate pay'?

Seth's grandmother gave him a $50 savings bond for his birthday.The bond pays $50 at maturity,which is in five years.If the interest rate is 5%,the bond has a present value of $43.19.

Serafina was earning $75 per hour and working 50 hours per week.Serafina's wage rose to $90 per hour,and as a result,she now works 60 hours per week.What can you conclude from this information about the income effect and the substitution effect of a wage change for Serafina?

Compared to a competitive market,a firm that has a monopsony in a labour market would

An individual's labour supply curve shows

A monopsony is a term used to refer to a firm that is the sole seller of a good or service.

Most economists believe that only a small gap between the wages of white males and the wages of other groups is due to education.Most of the gap is explained by discrimination.

The change in a firm's revenue as a result of hiring one more worker

The income effect of a wage increase will cause a worker to devote

The demand for labour is described as a derived demand because

If it is difficult for a firm to attribute the output it produces to a particular worker,then

Which of the following variables will not cause the market supply curve of labour to shift?

Marginal revenue product falls as more labour is hired because

Economics: Foundations and Models

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: the Responsiveness of Demand and Supply

Economic Efficiency, Government Price Setting and Taxes

Consumer Choice and Behavioural Economics

Technology, Production and Costs

Firms in Perfectly Competitive Markets

Monopoly Markets

Monopolistic Competition

Oligopoly: Firms in Less Competitive Markets

International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

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