Question 1

Employers can sometimes organize to pay lower wages when:

Accepted Answer

A)  efficiency wages are used to drive down morale and break up a labour union. 
B)  insurance companies organize to get groups of dentists to work together at lower wages than they would earn on their own. 
C)  labour unions are not allowed to engage in collective bargaining. 
D)  corporations force the minimum wage down. 
A)  efficiency wages are used to drive down morale and break up a labour union. 
B)  insurance companies organize to get groups of dentists to work together at lower wages than they would earn on their own. 
C)  labour unions are not allowed to engage in collective bargaining. 
D)  corporations force the minimum wage down.

Question 2

Scott's wage is $25 per hour and he works 50 hours a week,which is his optimal labour supply at that wage.His marginal utility of 1 hour of leisure is equal to the:

Accepted Answer

A)  marginal utility he gets from $25 worth of goods. 
B)  marginal utility he gets from more than $25 worth of goods. 
C)  marginal utility he gets from less than $25 worth of goods. 
D)  substitution effect. 
A)  marginal utility he gets from $25 worth of goods. 
B)  marginal utility he gets from more than $25 worth of goods. 
C)  marginal utility he gets from less than $25 worth of goods. 
D)  substitution effect.

Question 3

Use the following to answer questions :
Figure: The Value of the Marginal Product Curve  
-(Figure: The Value of the Marginal Product Curve)Use Figure: The Value of the Marginal Product Curve.In the figure,if the market wage rate increases,then the:

Accepted Answer

A)  VMPL curve will shift to the right. 
B)  profit-maximizing quantity of labour will increase. 
C)  VMPL curve will shift to the left. 
D)  profit-maximizing quantity of labour will decrease. 
A)  VMPL curve will shift to the right. 
B)  profit-maximizing quantity of labour will increase. 
C)  VMPL curve will shift to the left. 
D)  profit-maximizing quantity of labour will decrease.

Question 4

The opportunity cost of an hour of leisure is always assumed to be equal to the minimum wage.

Accepted Answer

A) True 
 B)False

Question 5

An increase in the demand for construction workers may come about because of a(n):

Accepted Answer

A)  increase in the demand for new housing. 
B)  decrease in the market wage rate for construction workers. 
C)  decrease in the productivity of construction workers. 
D)  decrease in the supply of other factors that construction workers use. 
A)  increase in the demand for new housing. 
B)  decrease in the market wage rate for construction workers. 
C)  decrease in the productivity of construction workers. 
D)  decrease in the supply of other factors that construction workers use.

Question 6

Use the following to answer questions :
Figure: The Demand for Bricklayers  
-(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.If the equilibrium market wage for bricklayers is $80 per day,then this masonry firm will hire _____ bricklayers.

Accepted Answer

A)  4 
B)  6 
C)  5 
D)  8 
A)  4 
B)  6 
C)  5 
D)  8

Question 7

Andy's individual labour supply curve is positively sloped,so for Andy,the substitution effect dominates the income effect.

Accepted Answer

A) True 
 B)False

Question 8

A factor demand curve will shift because:

Accepted Answer

A)  of a change in the price of the good the factor produces. 
B)  the elasticity of demand for the final product is high. 
C)  of a change in the proportion of the factor's cost relative to total cost. 
D)  the slope of the MP curve is negative. 
A)  of a change in the price of the good the factor produces. 
B)  the elasticity of demand for the final product is high. 
C)  of a change in the proportion of the factor's cost relative to total cost. 
D)  the slope of the MP curve is negative.

Question 9

According to the marginal productivity theory of income distribution,if a unit of labour is paid more than a unit of capital,it is because,at the equilibrium quantity of each factor,the value of the marginal product of labour is proportionately greater than the value of the marginal product of capital.

Accepted Answer

A) True 
 B)False

Question 10

At Hamill Manufacturing of Alberta,highly skilled senior machinists are paid $70 000,excluding benefits,but the average-skilled machinist generates approximately $137 000 in value added.This is partially because diminishing returns to labour cause the value of the marginal product of the last machinist hired to be less than the average of all of the machinists currently employed.

Accepted Answer

A) True 
 B)False

Question 11

Use the following to answer questions :
Figure: The Demand for Bricklayers  
-(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.The equilibrium market wage for bricklayers is $100 a day,but there is a new minimum wage of $120.Therefore:

Accepted Answer

A)  3 workers who otherwise would have been employed by this firm are now unemployed. 
B)  4 workers will now be hired by this firm. 
C)  all bricklayers are better off. 
D)  this firm will shut down. 
A)  3 workers who otherwise would have been employed by this firm are now unemployed. 
B)  4 workers will now be hired by this firm. 
C)  all bricklayers are better off. 
D)  this firm will shut down.

Question 12

A firm's demand curve for labour is:

Accepted Answer

A)  its marginal cost curve. 
B)  its marginal product curve. 
C)  its value of the marginal product of labour curve. 
D)  horizontal if it is in perfect competition. 
A)  its marginal cost curve. 
B)  its marginal product curve. 
C)  its value of the marginal product of labour curve. 
D)  horizontal if it is in perfect competition.

Question 13

In 2015,women,regardless of ethnicity,earned:

Accepted Answer

A)  the same as White men. 
B)  about twice as much as White men. 
C)  about 67% of the earnings for White men. 
D)  about 25% of the earnings for White men. 
A)  the same as White men. 
B)  about twice as much as White men. 
C)  about 67% of the earnings for White men. 
D)  about 25% of the earnings for White men.

Question 14

Which factor will NOT shift the labour supply curve?

Accepted Answer

A)  a change in attitude toward work 
B)  changes in a spouse's income 
C)  changes in expectations about future wealth 
D)  a change in the wage rate 
A)  a change in attitude toward work 
B)  changes in a spouse's income 
C)  changes in expectations about future wealth 
D)  a change in the wage rate

Question 15

If the hourly wage increases from $8 to $10 an hour and in response Jim increases the number of hours that he works from 44 to 46,the income effect is dominant.

Accepted Answer

A) True 
 B)False

Question 16

If the hourly wage increases from $8 to $10 an hour and in response Jim increases the number of hours that he works from 44 to 46,the substitution effect is dominant.

Accepted Answer

A) True 
 B)False

Question 17

Suppose that there are diminishing returns to labour.If the _____ of labour hired by a firm increases,holding everything else constant,the _____ labour will _____.

Accepted Answer

A)  price;demand for;increase 
B)  quantity;marginal product of;fall 
C)  quantity;marginal product of;rise 
D)  quantity;value of the marginal product of;rise 
A)  price;demand for;increase 
B)  quantity;marginal product of;fall 
C)  quantity;marginal product of;rise 
D)  quantity;value of the marginal product of;rise

Question 18

Which example illustrates wage disparity due to compensating differentials?

Accepted Answer

A)  Clerks at a Gap in Toronto earn more than do clerks at a Gap in Abitibi,Quebec. 
B)  People with graduate degrees usually have higher earnings than do people who did not graduate from high school. 
C)  The football coach at the University of Toronto earns more than does an economics professor. 
D)  Crab fishermen on the Bering Sea earn more than do clerks who sell goldfish at a pet store. 
A)  Clerks at a Gap in Toronto earn more than do clerks at a Gap in Abitibi,Quebec. 
B)  People with graduate degrees usually have higher earnings than do people who did not graduate from high school. 
C)  The football coach at the University of Toronto earns more than does an economics professor. 
D)  Crab fishermen on the Bering Sea earn more than do clerks who sell goldfish at a pet store.

Question 19

Suppose that Billy Bud's Bucking Broncos employs 20 workers at a daily wage of $60 each.The average product of labour is 30 bucking broncos per day,the marginal product of the last worker is 12 bucking broncos per day,and total fixed cost is $3 600 for equipment.What is the marginal cost of the last bucking bronco produced?

Accepted Answer

A)  $0.20 
B)  $5.00 
C)  $240.00 
D)  $720.00 
A)  $0.20 
B)  $5.00 
C)  $240.00 
D)  $720.00

Question 20

Use the following to answer questions :
Figure: Equilibrium in the Labour Market  
-According to the marginal productivity theory of income distribution,every factor of production is paid _____ the equilibrium value of its _____ product.

Accepted Answer

A)  exactly;marginal 
B)  more than;marginal 
C)  less than;marginal 
D)  exactly;average 
A)  exactly;marginal 
B)  more than;marginal 
C)  less than;marginal 
D)  exactly;average

Employers can sometimes organize to pay lower wages when:

Scott's wage is $25 per hour and he works 50 hours a week,which is his optimal labour supply at that wage.His marginal utility of 1 hour of leisure is equal to the:

Use the following to answer questions : Figure: The Value of the Marginal Product Curve -(Figure: The Value of the Marginal Product Curve)Use Figure: The Value of the Marginal Product Curve.In the figure,if the market wage rate increases,then the:

The opportunity cost of an hour of leisure is always assumed to be equal to the minimum wage.

An increase in the demand for construction workers may come about because of a(n):

Use the following to answer questions : Figure: The Demand for Bricklayers -(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.If the equilibrium market wage for bricklayers is $80 per day,then this masonry firm will hire _____ bricklayers.

Andy's individual labour supply curve is positively sloped,so for Andy,the substitution effect dominates the income effect.

A factor demand curve will shift because:

Use the following to answer questions : Figure: The Demand for Bricklayers -(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.The equilibrium market wage for bricklayers is $100 a day,but there is a new minimum wage of $120.Therefore:

A firm's demand curve for labour is:

In 2015,women,regardless of ethnicity,earned:

Which factor will NOT shift the labour supply curve?

If the hourly wage increases from $8 to $10 an hour and in response Jim increases the number of hours that he works from 44 to 46,the income effect is dominant.

If the hourly wage increases from $8 to $10 an hour and in response Jim increases the number of hours that he works from 44 to 46,the substitution effect is dominant.

Suppose that there are diminishing returns to labour.If the ___ of labour hired by a firm increases,holding everything else constant,the _ labour will ___.

Which example illustrates wage disparity due to compensating differentials?

Use the following to answer questions : Figure: Equilibrium in the Labour Market -According to the marginal productivity theory of income distribution,every factor of production is paid _ the equilibrium value of its _ product.

First Principles

Economic Models

Supply and Demand

Consumer and Producer Surplus

Price Controls and Quotas

Elasticity

Taxes

International Trade

Decision Making by Individuals and Firms

The Rational Consumer

Behind the Supply Curve- Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition

Externalities

Public Goods and Common Resources

The Economics of the Welfare State

Uncertainty, risk, and Private Information

Graphs in Economics

Consumer Preferences

Indifference Curve Analysis

Filters

Exam 19: Factor Markets and the Distribution of Income

Employers can sometimes organize to pay lower wages when:

Scott's wage is $25 per hour and he works 50 hours a week,which is his optimal labour supply at that wage.His marginal utility of 1 hour of leisure is equal to the:

Use the following to answer questions : Figure: The Value of the Marginal Product Curve -(Figure: The Value of the Marginal Product Curve)Use Figure: The Value of the Marginal Product Curve.In the figure,if the market wage rate increases,then the:

The opportunity cost of an hour of leisure is always assumed to be equal to the minimum wage.

An increase in the demand for construction workers may come about because of a(n):

Use the following to answer questions : Figure: The Demand for Bricklayers -(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.If the equilibrium market wage for bricklayers is $80 per day,then this masonry firm will hire _____ bricklayers.

Andy's individual labour supply curve is positively sloped,so for Andy,the substitution effect dominates the income effect.

A factor demand curve will shift because:

Use the following to answer questions : Figure: The Demand for Bricklayers -(Figure: The Demand for Bricklayers)Use Figure: The Demand for Bricklayers.The equilibrium market wage for bricklayers is $100 a day,but there is a new minimum wage of $120.Therefore:

A firm's demand curve for labour is:

In 2015,women,regardless of ethnicity,earned:

Which factor will NOT shift the labour supply curve?

If the hourly wage increases from $8 to $10 an hour and in response Jim increases the number of hours that he works from 44 to 46,the income effect is dominant.

If the hourly wage increases from $8 to $10 an hour and in response Jim increases the number of hours that he works from 44 to 46,the substitution effect is dominant.

Suppose that there are diminishing returns to labour.If the _____ of labour hired by a firm increases,holding everything else constant,the _____ labour will _____.

Which example illustrates wage disparity due to compensating differentials?

Use the following to answer questions : Figure: Equilibrium in the Labour Market -According to the marginal productivity theory of income distribution,every factor of production is paid _____ the equilibrium value of its _____ product.

First Principles

Economic Models

Supply and Demand

Consumer and Producer Surplus

Price Controls and Quotas

Elasticity

Taxes

International Trade

Decision Making by Individuals and Firms

The Rational Consumer

Behind the Supply Curve- Inputs and Costs

Perfect Competition and the Supply Curve

Monopoly

Oligopoly

Monopolistic Competition

Externalities

Public Goods and Common Resources

The Economics of the Welfare State

Uncertainty, risk, and Private Information

Graphs in Economics

Consumer Preferences

Indifference Curve Analysis

Filters

Suppose that there are diminishing returns to labour.If the ___ of labour hired by a firm increases,holding everything else constant,the _ labour will ___.

Use the following to answer questions : Figure: Equilibrium in the Labour Market -According to the marginal productivity theory of income distribution,every factor of production is paid _ the equilibrium value of its _ product.