Exam 16: The Labor Market

The substitution effect of wages states that a decreased wage rate

The marginal physical product of labor is equal to

The market supply of labor is

Output (units) Labor (units) Output (units) Capital (units) 10 1 20 1 26 2 56 2 38 3 86 3 Table 30.5 Assume that in Table 30.5 the cost of labor is $4 per unit and the cost of capital is $6 per unit.In Table 30.5, what is the cost efficiency of the second unit of labor?

The opportunity cost of working is the

If the MPP of an additional unit of labor is 4 units per hour, product price is constant at $5 per unit, and the wage rate is $19 per hour, then

If the MPP is declining, ceteris paribus, the MRP must decline.

Kip will work fewer hours if his salary increases.For Kip, the ___________ effect must outweigh the __________ effect.

An individual's labor supply curve

The efficiency decision involves choosing the input combination or process that

When the minimum wage is raised in a competitive market, ceteris paribus,

If the price for a box of kiwis is $40, the wage rate for kiwi laborers is $10 per hour, and a laborer can pick 3 boxes of kiwis per hour, the

For wages to be higher without sacrificing jobs, productivity must decrease.

Number of stylist (per week)	total output(per week)	marginal physical product (output per stylist)	total revenue(dollars per week)	marginal revenue product (dollars per stylist)
0	0	......	$0	........
1	60	______	______	______
2	80	______	______	______
3	90	______	______	______
4	90	______	______	______

Table $30.4$ Hairstyling Appointments and Revenues Table 30.4 shows how many hairstyling appointments a hair salon can schedule per week based on the number of stylists.In the spaces provided, compute the marginal physical product (MPP) of the hairstylists, total revenue, and the marginal revenue product of the stylists, assuming that a hairstylist Charges $60 per appointment.In Table 30.4, what is the marginal physical product of the fourth hairstylist?

Cost efficiency is achieved when the MPP of a worker relative to the worker's wage is the same for all workers.

Number of workers (per hour)	total output(per hour)	marginal physical product (output per worker)	total revenue(dollars per hour)	marginal revenue product (output per worker)
1	4	......	______	........
2	10	______	______	______
3	15	______	______	______
4	19	______	______	______
5	22	______	______	______

Table $30.1$ Assume that the product price is $4 per unit and that the hourly wage for workers is $12.Neither price nor wage changes with output.In Table 30.1, the contribution to total revenue of the fourth worker hired is

Institutional constraints, such as immigration policies, affect the shape and location of the labor supply curve.

If there is an increase in the number of workers who want to work as accountants, there will be a

Ceteris paribus, all of the following result when the minimum wage is raised and is above the equilibrium in a competitive market, except

If the wage rate drops, an employer will be willing to hire more workers, ceteris paribus.