Question 1

Table 18-6 
-Refer to Table 18-6. What is the value for the cell labeled DD?

Accepted Answer

A)  −$100
B)  $300
C)  $100
D)  $50E) All of the above
F) B) and D)

Question 2

The demand curve for capital

Accepted Answer

A)  is vertical.
B)  is horizontal.
C)  is derived from households' decisions concerning saving and spending.
D)  reflects the marginal productivity of capital.E) B) and C)
F) All of the above

Question 3

John owns a number of hot dog stands in New York City. He hires workers to sell hot dogs at his stands. Which of the following events will lead to a decrease in John's demand for hot dog vendors?

Accepted Answer

A)  Hollywood glamorization of a new movie about a hot dog vendor leads hundreds of high-school students in New York City to apply for a job at John's.
B)  The price of hot dogs falls.
C)  The local hot dog vendors form a union increasing hot dog vendor wages.
D)  The demand curve for hot dogs shifts to the right.E) A) and D)
F) C) and D)

Question 4

Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

Accepted Answer

A)  The VMPL increases by less than $4.
B)  The VMPL increases by $4.
C)  The VMPL increases by more than $4.
D)  The VMPL decreases by $4.E) A) and B)
F) B) and D)

Question 5

The supply of labor in any one market depends on the opportunities available in other markets.

Accepted Answer

A) True 
 B)False

Question 6

Table 18-B
Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day. 
-Refer to Table 18-11. Assuming MadeFromScratch is a competitive, profit-maximizing firm, how many workers will the firm hire?

Accepted Answer

A)  2 workers
B)  3 workers
C)  4 workers
D)  5 workersE) A) and C)
F) B) and C)

Question 7

Which of the following would not shift a market labor supply curve to the left?

Accepted Answer

A)  an increase in the wage paid to workers in a competing market
B)  labor-saving technology
C)  a change in worker tastes so that workers want to retire earlier
D)  an increase in immigrationE) All of the above
F) A) and B)

Question 8

The wage is to the labor market as the

Accepted Answer

A)  rental price of capital is to the capital market.
B)  purchase price of capital is to the capital market.
C)  supply of land is to the land market.
D)  demand for land is to the land market.E) None of the above
F) B) and C)

Question 9

Table 18-3 
-Refer to Table 18-3. Which firm's production function exhibits positive but diminishing marginal product?

Accepted Answer

A)  Firm A
B)  Firm B
C)  Firm C
D)  Firm DE) A) and B)
F) A) and C)

Question 10

Table 18-8
Harold and Maude own a dance studio where they and their employees teach ballroom dancing. Their company is a competitive, profit-maximizing firm. Harold and Maude's production function is detailed in the table below. 
-Refer to Table 18-8. If Harold and Maude pay their workers $80 per day and charge $20 per dance lesson, what is the value of the marginal product of the third worker?

Accepted Answer

A)  $400
B)  $800
C)  $1,000
D)  $1,600E) B) and D)
F) None of the above

Question 11

Diane's Auto World installs tires on automobiles, light trucks, and sport utility vehicles. She is a profit-maximizing business owner whose firm operates in a competitive market. The marginal cost of installing a tire is $20. The marginal productivity of the last worker that Diane hired was 2 tires per hour. What is the maximum hourly wage that Diane was willing to pay the last worker hired?

Accepted Answer

A)  $10
B)  $20
C)  $40
D)  There is insufficient information to answer this question.E) A) and B)
F) A) and C)

Question 12

A household member's decision about how much labor to supply is most closely linked to

Accepted Answer

A)  the supply of factors of production other than labor.
B)  technological change.
C)  the tradeoff between leisure and work.
D)  immigration trends.E) C) and D)
F) B) and D)

Question 13

Typically, as a firm hires additional workers, the marginal product of labor

Accepted Answer

A)  decreases, and the value of the marginal product of labor decreases.
B)  stays constant, and the value of the marginal product of labor decreases.
C)  decreases, and the value of the marginal product of labor stays constant.
D)  decreases, and the value of the marginal product of labor increases.E) C) and D)
F) All of the above

Question 14

Sally runs a hair styling salon. Sally is a profit-maximizing owner whose firm operates in a competitive market. The marginal cost of a haircut is $15. What is the maximum wage that Sally will pay her stylists?

Accepted Answer

A)  less than $15 per haircut
B)  $15 per haircut
C)  more than $15 haircut
D)  There is insufficient information to answer this question.E) C) and D)
F) A) and D)

Question 15

The marginal product of land depends only on the quantity of land available.

Accepted Answer

A) True 
 B)False

Question 16

In a representative labor market,

Accepted Answer

A)  the wage adjusts to balance the supply and demand for labor.
B)  the wage equals the value of the marginal product of labor.
C)  an increase in the supply of labor increases the equilibrium wage.
D)  Both a and b are correct.E) A) and B)
F) C) and D)

Question 17

Table 18-1 
-Refer to Table 18-1. What is the marginal product of the second worker?

Accepted Answer

A)  8
B)  9
C)  10
D)  18E) B) and C)
F) A) and D)

Question 18

Figure 18-2
The figure below shows the production function for a particular firm. 
-Refer to Figure 18-2. The marginal product of the fourth worker is

Accepted Answer

A)  100 units.
B)  25 units.
C)  20 units.
D)  10 units.E) None of the above
F) A) and D)

Question 19

Which of the following best illustrates the concept of "derived demand?"

Accepted Answer

A)  An increase in the wages of auto workers will lead to an increase in the demand for robots in automobile factories.
B)  An automobile producer's decision to supply more cars will lead to an increase in the demand for automobile production workers.
C)  An automobile producer's decision to supply more minivans results from a decrease in the demand for station wagons.
D)  An increase in the price of gasoline will lead to an increase in the demand for small cars.E) None of the above
F) C) and D)

Question 20

Figure 18-1. The figure shows the relationship between the number of mechanics hired and the number of car repairs performed per day at a car-repair shop. 
-Refer to Figure 18-1. The relationship depicted on the graph is called a _______ function.

Accepted Answer

The answer of Figure 18-1. The figure shows the relationship...

Exam 18: The Markets for the Factors of Production

Which of the following would not shift a market labor supply curve to the left?

Correct Answer
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Correct Answer
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Typically, as a firm hires additional workers, the marginal product of labor

Correct Answer
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The demand curve for capital

Correct Answer
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A household member's decision about how much labor to supply is most closely linked to

Correct Answer
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Table 18-6 -Refer to Table 18-6. What is the value for the cell labeled DD?

Correct Answer
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Table 18-1 -Refer to Table 18-1. What is the marginal product of the second worker?

Correct Answer
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Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

Correct Answer
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Table 18-3 -Refer to Table 18-3. Which firm's production function exhibits positive but diminishing marginal product?

Correct Answer
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The supply of labor in any one market depends on the opportunities available in other markets.

Correct Answer
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In a representative labor market,

Correct Answer
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The marginal product of land depends only on the quantity of land available.

Correct Answer
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Which of the following best illustrates the concept of "derived demand?"

Correct Answer
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Correct Answer
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The wage is to the labor market as the

Correct Answer
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Figure 18-1. The figure shows the relationship between the number of mechanics hired and the number of car repairs performed per day at a car-repair shop. -Refer to Figure 18-1. The relationship depicted on the graph is called a _______ function.

Correct Answer
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Table 18-B Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day. -Refer to Table 18-11. Assuming MadeFromScratch is a competitive, profit-maximizing firm, how many workers will the firm hire?

Correct Answer
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John owns a number of hot dog stands in New York City. He hires workers to sell hot dogs at his stands. Which of the following events will lead to a decrease in John's demand for hot dog vendors?

Correct Answer
verified

Figure 18-2 The figure below shows the production function for a particular firm. -Refer to Figure 18-2. The marginal product of the fourth worker is

Correct Answer
verified

Sally runs a hair styling salon. Sally is a profit-maximizing owner whose firm operates in a competitive market. The marginal cost of a haircut is $15. What is the maximum wage that Sally will pay her stylists?

Correct Answer
verified

Exam 18: The Markets for the Factors of Production

Which of the following would not shift a market labor supply curve to the left?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Typically, as a firm hires additional workers, the marginal product of labor

Correct AnswerverifiedShow Answer

The demand curve for capital

Correct AnswerverifiedShow Answer

A household member's decision about how much labor to supply is most closely linked to

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Table 18-6 -Refer to Table 18-6. What is the value for the cell labeled DD?

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Table 18-1 -Refer to Table 18-1. What is the marginal product of the second worker?

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Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

Correct AnswerverifiedShow Answer

Table 18-3 -Refer to Table 18-3. Which firm's production function exhibits positive but diminishing marginal product?

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The supply of labor in any one market depends on the opportunities available in other markets.

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In a representative labor market,

Correct AnswerverifiedShow Answer

The marginal product of land depends only on the quantity of land available.

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Which of the following best illustrates the concept of "derived demand?"

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The wage is to the labor market as the

Correct AnswerverifiedShow Answer

Figure 18-1. The figure shows the relationship between the number of mechanics hired and the number of car repairs performed per day at a car-repair shop. -Refer to Figure 18-1. The relationship depicted on the graph is called a _______ function.

Correct AnswerverifiedShow Answer

Table 18-B Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day. -Refer to Table 18-11. Assuming MadeFromScratch is a competitive, profit-maximizing firm, how many workers will the firm hire?

Correct AnswerverifiedShow Answer

John owns a number of hot dog stands in New York City. He hires workers to sell hot dogs at his stands. Which of the following events will lead to a decrease in John's demand for hot dog vendors?

Correct AnswerverifiedShow Answer

Figure 18-2 The figure below shows the production function for a particular firm. -Refer to Figure 18-2. The marginal product of the fourth worker is

Correct AnswerverifiedShow Answer

Sally runs a hair styling salon. Sally is a profit-maximizing owner whose firm operates in a competitive market. The marginal cost of a haircut is $15. What is the maximum wage that Sally will pay her stylists?

Correct AnswerverifiedShow Answer

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