Use the following to answer questions : Scenario: The Decision to Hire Labour Assume that both the product market and the labour market are perfectly competitive.The price of this firm's product is $5.The firm's total product with respect to labour is given in the table that follows. $\begin{array}{llcc} \hline \text { Quantity } & \\ \text { of Labour } & \text { Quantity } \\ \text { (workers) } & \text {of Output }\\ \hline 0&0\\ 1 &7\\ 2 &13\\ 3&18\\ 4&21\\ \hline \end{array}$ -(Scenario: The Decision to Hire Labour)Use Scenario: The Decision to Hire Labour.How many workers will this perfectly competitive,profit-maximizing firm choose to hire if the equilibrium wage is $30?

A) 1 B) 2 C) 3 D) 4 A) 1 B) 2 C) 3 D) 4

Use the following to answer questions : Scenario: The Decision to Hire Labour Assume that both the product market and the labour market are perfectly competitive.The price of this firm's product is $5.The firm's total product with respect to labour is given in the table that follows. $\begin{array}{llcc} \hline \text { Quantity } & \\ \text { of Labour } & \text { Quantity } \\ \text { (workers) } & \text {of Output }\\ \hline 0&0\\ 1 &7\\ 2 &13\\ 3&18\\ 4&21\\ \hline \end{array}$ -(Scenario: The Decision to Hire Labour)Use Scenario: The Decision to Hire Labour.If this profit-maximizing firm hires 2 workers,what is a possible equilibrium wage rate in the labour market?

A) $30 B) $5 C) $13 D) $6 A) $30 B) $5 C) $13 D) $6

Use the following to answer questions : \[\begin{array}{l} \text { Table: Workers and Corn Output }\\ \begin{array} { l c } \hline \begin{array} { l } \text { Numbers } \\ \text { of Workers } \end{array} & \begin{array} { c } \text { Output } \\ \text { of Corn } \\ \text { (units of corn) } \end{array} \\ \hline 0 & 0 \\ 1 & 30 \\ 2 & 58 \\ 3 & 79 \\ 4 & 94 \\ 5 & 104 \\ 6 & 108 \\ 7 & 110 \\ \hline \end{array} \end{array}\] -(Table: Workers and Corn Output)Use Table: Workers and Corn Output.Laura is a price-taking farmer who produces corn.Assume that the wage rate for workers is $130 and the price per kilogram of corn is $10.Suppose that Laura is employing 2 workers.If she adds the third worker,her profits will:

A) increase by $79. B) decrease by $51. C) decrease by $19. D) increase by $80. A) increase by $79. B) decrease by $51. C) decrease by $19. D) increase by $80.

Exam 19: Factor Markets and the Distribution of Income

Benny employs people to sell candy bars at intersections.Assume that Benny can obtain candy bars to sell for no cost.The marginal product of the last worker Benny hired is 20 candy bars per hour.Benny pays $7 per worker per hour and sells the candy bars for $1 each.If the price of candy bars rises to $2,then the:

(Multiple Choice)

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Question 161

Which statement is TRUE?

(Multiple Choice)

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Question 162

The factor distribution of income in Canada reflects that:

(Multiple Choice)

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Question 163

The ___ effect of a _ wage causes individuals to substitute ___.

(Multiple Choice)

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Question 164

Since the 1960s,the number of women in the labour force has decreased.

(True/False)

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Question 165

Use the following to answer questions : Scenario: The Decision to Hire Labour Assume that both the product market and the labour market are perfectly competitive.The price of this firm's product is $5.The firm's total product with respect to labour is given in the table that follows. Quantity of Labour Quantity (workers) of Output 0 0 1 7 2 13 3 18 4 21 -(Scenario: The Decision to Hire Labour)Use Scenario: The Decision to Hire Labour.How many workers will this perfectly competitive,profit-maximizing firm choose to hire if the equilibrium wage is $30?

(Multiple Choice)

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Question 166

The value of the marginal product is equal to:

(Multiple Choice)

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Question 167

Derived demand for a factor of production means that:

(Multiple Choice)

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Question 168

Which statement is MOST likely an example of wage disparity due to differences in talent and ability?

(Multiple Choice)

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Question 169

Use the following to answer questions : $\text {Table: Value of the Marginal}$ $\text {Product of Labour at Demand}$ Quantity of Labour Total Product 0 0 1 20 2 50 3 90 4 120 5 140 6 150 7 150 8 140 -(Table: Value of the Marginal Product of Labour and Demand)Use Table: Value of the Marginal Product of Labour and Demand.In the table,the total product of labour is shown for the hourly production of power cords.Assume that the market for power cords is perfectly competitive.If the price of a power cord is $4 and the market wage rate is $120 per hour,the profit-maximizing quantity of labour is _____ workers.

(Multiple Choice)

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Question 170

In the factor market for land,equilibrium rental prices will be _____ the value of marginal product of land.

(Multiple Choice)

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Question 171

A firm's demand curve for labour is:

(Multiple Choice)

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Question 172

If an individual labour supply curve is negatively sloped,the substitution effect dominates the income effect.

(True/False)

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Question 173

Use the following to answer questions : Scenario: The Decision to Hire Labour Assume that both the product market and the labour market are perfectly competitive.The price of this firm's product is $5.The firm's total product with respect to labour is given in the table that follows. Quantity of Labour Quantity (workers) of Output 0 0 1 7 2 13 3 18 4 21 -(Scenario: The Decision to Hire Labour)Use Scenario: The Decision to Hire Labour.If this profit-maximizing firm hires 2 workers,what is a possible equilibrium wage rate in the labour market?

(Multiple Choice)

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Question 174

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 equal to the value of the marginal product of capital.

(True/False)

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Question 175

Use the following to answer questions : $\text {Table: Value of the Marginal}$ $\text {Product of Labour at Demand}$ Quantity of Labour Total Product 0 0 1 20 2 50 3 90 4 120 5 140 6 150 7 150 8 140 -(Table: Value of the Marginal Product of Labour and Demand)Use Table: Value of the Marginal Product of Labour and Demand.In the table,the total product of labour is shown for the hourly production of power cords.Assume that the market for power cords is perfectly competitive.The price of a power cord is $2,the market wage rate is $40 per hour,and 4 workers are hired.Profit can be maximized by hiring _____ worker(s).

(Multiple Choice)

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Question 176

Above-equilibrium wages paid by some employers as an incentive for better performance are called compensating differentials.

(True/False)

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Question 177

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

(True/False)

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Question 178

Use the following to answer questions : Table: Workers and Corn Output Numbers of Workers Output of Corn (units of corn) 0 0 1 30 2 58 3 79 4 94 5 104 6 108 7 110 -(Table: Workers and Corn Output)Use Table: Workers and Corn Output.Laura is a price-taking farmer who produces corn.Assume that the wage rate for workers is $130 and the price per kilogram of corn is $10.Suppose that Laura is employing 2 workers.If she adds the third worker,her profits will:

(Multiple Choice)

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Question 179

All perfectly competitive fast-food firms are hiring the profit-maximizing quantity of labour and are paying their workers $7 per hour.If the government raises the minimum wage to $8 per hour:

(Multiple Choice)

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Question 180

Which statement is TRUE?

The factor distribution of income in Canada reflects that:

The ___ effect of a _ wage causes individuals to substitute ___.

Since the 1960s,the number of women in the labour force has decreased.

The value of the marginal product is equal to:

Derived demand for a factor of production means that:

Which statement is MOST likely an example of wage disparity due to differences in talent and ability?

In the factor market for land,equilibrium rental prices will be _____ the value of marginal product of land.

A firm's demand curve for labour is:

If an individual labour supply curve is negatively sloped,the substitution effect dominates the income effect.

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 equal to the value of the marginal product of capital.

Above-equilibrium wages paid by some employers as an incentive for better performance are called compensating differentials.

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

All perfectly competitive fast-food firms are hiring the profit-maximizing quantity of labour and are paying their workers $7 per hour.If the government raises the minimum wage to $8 per hour:

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

Which statement is TRUE?

The factor distribution of income in Canada reflects that:

The _____ effect of a _____ wage causes individuals to substitute _____.

Since the 1960s,the number of women in the labour force has decreased.

The value of the marginal product is equal to:

Derived demand for a factor of production means that:

Which statement is MOST likely an example of wage disparity due to differences in talent and ability?

In the factor market for land,equilibrium rental prices will be _____ the value of marginal product of land.

A firm's demand curve for labour is:

If an individual labour supply curve is negatively sloped,the substitution effect dominates the income effect.

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 equal to the value of the marginal product of capital.

Above-equilibrium wages paid by some employers as an incentive for better performance are called compensating differentials.

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

All perfectly competitive fast-food firms are hiring the profit-maximizing quantity of labour and are paying their workers $7 per hour.If the government raises the minimum wage to $8 per hour:

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

The ___ effect of a _ wage causes individuals to substitute ___.