Question 1

Efficiency wage theory suggests it may be efficient to pay more than the market wage

Accepted Answer

A) True 
 B)False  True

Question 2

A minimum wage set below equilibrium will lead to excess supply of labour

Accepted Answer

A) True 
 B)False  False

Question 3

Which is most likely to lead to a decrease in the wage rate?

Accepted Answer

A)   An increase in the demand for labour.
B)   An increase in the supply for labour.
C)   A decrease in the supply of labour.
D)   An increase in the demand for the product B

Question 4

The demand for labour depends on the demand for the final product; it is known as a _______ demand.

Accepted Answer

The answer of The demand for labour depends on the...

Question 5

The reservation wage is the maximum amount an employee would need to accept a job

Accepted Answer

A) True 
 B)False

Question 6

How may an increase in the demand for labour occur?

Accepted Answer

A)   When there is less productivity
B)   With a decrease in demand for the final product.
C)   With an increase in the revenue from selling the extra units.
D)   With an increase in the supply of labour.

Question 7

Which is most likely to lead to an increase in the wage rate?

Accepted Answer

A)   An increase in the demand for labour.
B)   An increase in the supply for labour.
C)   A decrease in the demand for labour.
D)   A decrease in the demand for the product

Question 8

An increase in labour productivity increases the demand for labour.

Accepted Answer