Question 1

The most common way for workers to hold market power is when:

Accepted Answer

A)   a monopsony exists.
B)   they are unionized.
C)   they compete for minimum wage.
D)   there are a lot of them.E) A) and D)
F) None of the above

Question 2

The value of the marginal product is the:

Accepted Answer

A)   marginal product generated by an additional unit of input times the price of output.
B)   marginal revenue generated by an additional unit of output times the number of workers hired.
C)   additional inputs required to produce one more additional unit of output.
D)   average revenue generated by workers at a firm.E) A) and B)
F) A) and C)

Question 3

When considering the factor distribution of income,which of the following income is represented as proprietor income?

Accepted Answer

A)   Rent for capital.
B)   Interest for loans on capital.
C)   Labor or capital factors that proprietors put into their businesses
D)   Wages for workersE) A) and B)
F) A) and C)

Question 4

At the competitive firm's profit-maximizing quantity of labor:

Accepted Answer

A)   the value of the last worker's marginal product is greater than or equal to marginal cost of that input.
B)   the value of the last worker's marginal product is less than the marginal cost of that input.
C)   marginal profits are always positive.
D)   the average product of labor is equal to the wage rate.E) A) and D)
F) None of the above

Question 5

The factors of production are the:

Accepted Answer

A)   ingredients that go into making any good or service.
B)   outputs that society as a whole have chosen to produce.
C)   costs and benefits of a given production process.
D)   list of inputs required for a given durable good.E) A) and B)
F) None of the above

Question 6

The marginal product generated by an additional unit of input times the price of the output is called:

Accepted Answer

A)   the value of the marginal product.
B)   the marginal revenue product.
C)   Both of these statements are true.
D)   Neither of these statements is true.E) All of the above
F) A) and C)

Question 7

If the demand for hand-sewn leather shoes increases,it is highly likely the demand for:

Accepted Answer

A)   leather will decrease.
B)   skilled sewers will increase.
C)   needle and thread will decrease.
D)   all shoe-types will also increase.E) B) and C)
F) A) and B)

Question 8

An individual labor-supply curve represents:

Accepted Answer

A)   a worker's decisions around how many hours to work at each alternative wage.
B)   the decisions of all workers around how many hours to work at each alternative wage.
C)   a firm's decisions around how many hours to hire at each alternative wage.
D)   the decisions of all firms around how many hours to work at each alternative wage.E) None of the above
F) B) and C)

Question 9

If the graph shown is displaying a competitive labor market:

Accepted Answer

A)   S would represent an individual worker's supply of labor at each wage.
B)   S would represent the firm's supply of jobs at each wage.
C)   P* would represent the equilibrium wage.
D)   Q* would represent the equilibrium wage.E) A) and D)
F) A) and C)

Question 10

Increased border patrol will affect the labor market in California.With a(n) _________ in labor supply,we would expect wages to __________.

Accepted Answer

A)   decrease; decrease
B)   decrease; increase
C)   increase; increase
D)   increase; decreaseE) A) and C)
F) All of the above

Question 11

A capital intensive production process is one in which:

Accepted Answer

A)   highly specialized capital is needed to produce the good.
B)   a part of the production process must be done by capital and cannot be substituted.
C)   a lot of capital is hired relative to the total inputs needed to produce the good.
D)   total costs will be minimized if capital is the primary factor of production used.E) B) and C)
F) C) and D)

Question 12

The rental price of capital is the:

Accepted Answer

A)   interest paid on loans.
B)   equilibrium wage.
C)   value of the expected flow of income gained from ownership.
D)   amount producers pay to use a factor of production.E) None of the above
F) B) and D)

Question 13

In general,when people talk about investing,they mean that they:

Accepted Answer

A)   have lent their money to someone who will use it to buy physical capital.
B)   have put money in the stock market.
C)   hold stocks or bonds.
D)   All of these statements are true.E) All of the above
F) C) and D)

Question 14

One reason that an efficiency wage leads to greater worker productivity is that:

Accepted Answer

A)   earning more than the market wage gives workers an incentive to stay with the firm.
B)   it deters workers from trying to start a union.
C)   due to competition for their jobs, which are now desired, firms to pay less overall for a worker in the long run.
D)   it is set right at market equilibrium which creates an efficient labor market.E) B) and D)
F) A) and C)

Question 15

For a competitive firm,the value of the marginal product:

Accepted Answer

A)   increases for each additional worker.
B)   remains constant across workers.
C)   decreases for each additional worker.
D)   is zero when profits are maximized.E) All of the above
F) B) and C)

Question 16

If Sam receives a pay cut and the income effect outweighs the price effect on his labor supply decision,he will:

Accepted Answer

A)   work more hours.
B)   work less hours.
C)   work the same hours no matter what.
D)   quit and not work at all.E) A) and B)
F) B) and D)

Question 17

If the demand for a good increases,it is likely that the demand for the factors of production used as inputs will:

Accepted Answer

A)   decrease.
B)   increase.
C)   stay the same.
D)   None of these statements is true.E) None of the above
F) B) and D)

Question 18

If the graph shown is displaying a competitive labor market:

Accepted Answer

A)   D would represent the workers' demand for jobs at each wage.
B)   S would represent the firm's supply of jobs at each wage.
C)   P* would represent the equilibrium wage.
D)   Q* would represent the most employment possible for the market.E) A) and B)
F) All of the above

Question 19

Any event that increases the value of the marginal product of labor will:

Accepted Answer

A)   increase labor demand.
B)   decrease labor demand.
C)   increase labor supply.
D)   decrease labor supply.E) B) and D)
F) None of the above

Question 20

If the product produced by workers experiences a decrease in demand,the value of marginal product of labor will:

Accepted Answer

A)   increase, increasing the demand for labor.
B)   increase, decreasing the demand for labor.
C)   decrease, increasing the demand for labor.
D)   decrease, decreasing the demand for labor.E) B) and C)
F) A) and D)

Exam 16: The Factors of Production

Increased border patrol will affect the labor market in California.With a(n) _________ in labor supply,we would expect wages to __________.

Correct AnswerverifiedShow Answer

If the product produced by workers experiences a decrease in demand,the value of marginal product of labor will:

Correct AnswerverifiedShow Answer

The marginal product generated by an additional unit of input times the price of the output is called:

Correct AnswerverifiedShow Answer

If the graph shown is displaying a competitive labor market:

Correct AnswerverifiedShow Answer

If the graph shown is displaying a competitive labor market:

Correct AnswerverifiedShow Answer

The most common way for workers to hold market power is when:

Correct AnswerverifiedShow Answer

If the demand for hand-sewn leather shoes increases,it is highly likely the demand for:

Correct AnswerverifiedShow Answer

At the competitive firm's profit-maximizing quantity of labor:

Correct AnswerverifiedShow Answer

If Sam receives a pay cut and the income effect outweighs the price effect on his labor supply decision,he will:

Correct AnswerverifiedShow Answer

The rental price of capital is the:

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One reason that an efficiency wage leads to greater worker productivity is that:

Correct AnswerverifiedShow Answer

The value of the marginal product is the:

Correct AnswerverifiedShow Answer

When considering the factor distribution of income,which of the following income is represented as proprietor income?

Correct AnswerverifiedShow Answer

In general,when people talk about investing,they mean that they:

Correct AnswerverifiedShow Answer

The factors of production are the:

Correct AnswerverifiedShow Answer

An individual labor-supply curve represents:

Correct AnswerverifiedShow Answer

For a competitive firm,the value of the marginal product:

Correct AnswerverifiedShow Answer

If the demand for a good increases,it is likely that the demand for the factors of production used as inputs will:

Correct AnswerverifiedShow Answer

Any event that increases the value of the marginal product of labor will:

Correct AnswerverifiedShow Answer

A capital intensive production process is one in which:

Correct AnswerverifiedShow Answer

Increased border patrol will affect the labor market in California.With a(n) _ in labor supply,we would expect wages to __.

Correct Answer
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