Question 1

If the supply of another input used decreases,the marginal product of labor can:

Accepted Answer

A)  increase,increasing the demand for labor.
B)  increase,decreasing the demand for labor.
C)  decrease,increasing the demand for labor.
D)  None of these statements is correct.E) All of the above
F) A) and B)

Question 2

Which of the following would be considered a "leisure" activity by economists?

Accepted Answer

A)  Mopping the floor at McDonald's for minimum wage
B)  Mopping your kitchen floor
C)  Folding sweaters while working at the Gap
D)  None of these activities would be considered leisure.E) A) and B)
F) B) and C)

Question 3

The determinants of labor supply include:

Accepted Answer

A)  culture,population,and other opportunities.
B)  supply of other factors,technology,and output prices.
C)  culture,supply of other factors,and technology.
D)  None of these statements is true.E) C) and D)
F) A) and C)

Question 4

In the U.S. ,some of the most powerful unions:

Accepted Answer

A)  have organized workers across several markets.
B)  have nearly 100 percent participation of workers.
C)  existed in the 1940s.
D)  All of these statements are true.E) A) and B)
F) A) and C)

Question 5

Derived demand:

Accepted Answer

A)  refers to the supply decisions of a final good influencing the demand for the inputs needed to make it.
B)  is the sum total of all factors of production for a given good or service.
C)  refers to the demand for variable inputs when at least one fixed input exists.
D)  is only computed for the long-run demand decisions based on short-run marginal changes.E) B) and C)
F) None of the above

Question 6

Sadie works at a factory for $15 an hour and typically works 40 hours a week.Sadie gets a pay raise and now earns $20 an hour.She decides to work 45 hours a week at $20 an hour.Her response to the pay increase demonstrates the:

Accepted Answer

A)  income effect outweighing the price effect.
B)  price effect outweighing the income effect.
C)  income effect outweighing the substitution effect.
D)  labor effect outweighing the price effect.E) C) and D)
F) All of the above

Question 7

A profit-seeking firm will choose the combination of inputs that:

Accepted Answer

A)  maximizes profit.
B)  maximizes costs.
C)  has the lowest average variable cost.
D)  has the lowest average total cost.E) A) and B)
F) None of the above

Question 8

When a worker has a rare skill or talent,supply in that labor market:

Accepted Answer

A)  is low.
B)  is high.
C)  depends on the other factors of production.
D)  depends on the output produced.E) All of the above
F) B) and C)

Question 9

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

Accepted Answer

A)  leather will increase.
B)  skilled sewers will increase.
C)  needle and thread will increase.
D)  All of these statements are true.E) A) and B)
F) B) and D)

Question 10

By comparing the value of marginal product with the marginal cost per input,a firm:

Accepted Answer

A)  can find the cost-maximizing quantity to hire.
B)  can find the profit-maximizing quantity to hire.
C)  can find the revenue-maximizing quantity to hire.
D)  can find the output-maximizing quantity to hire.E) C) and D)
F) A) and B)

Question 11

In general,as wages increase:

Accepted Answer

A)  people are willing to work less.
B)  people are willing to work more.
C)  it does not affect people's willingness to work.
D)  the benefit of working goes down.E) C) and D)
F) B) and C)

Question 12

The increase in the quantity of labor supplied in response to a higher wage is called the:

Accepted Answer

A)  price effect.
B)  labor effect.
C)  income effect.
D)  substitution effect.E) A) and B)
F) A) and C)

Question 13

The competitive firm's profit-maximizing quantity of labor is the quantity where:

Accepted Answer

A)  the value of the marginal product of labor is equal to the market wage.
B)  the quantity of the marginal product of labor is equal to the market wage.
C)  the quantity of the marginal product of labor is equal to zero.
D)  the value of the marginal product of labor is equal to the profit.E) None of the above
F) B) and C)

Question 14

Which of the following industries has the option to be labor or capital intensive in its production process?

Accepted Answer

A)  Fishing
B)  Baking
C)  Teaching
D)  All of these production processes could be either capital or labor intensive.E) A) and C)
F) None of the above

Question 15

Workers compete against those who have:

Accepted Answer

A)  the same human capital.
B)  similar human capital.
C)  totally different human capital.
D)  all workers,regardless of their human capital.E) A) and C)
F) B) and C)

Question 16

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

Accepted Answer

A)  decrease labor demand.
B)  decrease labor supply.
C)  increase labor demand.
D)  increase labor supply.E) B) and D)
F) A) and B)

Question 17

The value of the marginal product is:

Accepted Answer

A)  the marginal product generated by and additional unit of input times the price of output.
B)  the marginal revenue generated by additional units of output times the number of workers hired.
C)  the additional inputs required to produce one more additional unit of output.
D)  None of these statements is true.E) B) and C)
F) All of the above

Question 18

A profit-seeking firm will choose the combination of inputs that maximizes profit,based on the:

Accepted Answer

A)  local price of each factor of production.
B)  ratio of each factor of production.
C)  substitutability of each factor of production.
D)  All of these statements are true.E) A) and C)
F) B) and C)

Question 19

If the labor market worked efficiently,then an effective minimum wage law would:

Accepted Answer

A)  cause unemployment.
B)  hold wages higher than the equilibrium price.
C)  help those who were employed at that price.
D)  All of these statements are true.E) All of the above
F) A) and B)

Question 20

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

Accepted Answer

A)  Rent
B)  Interest
C)  Labor or capital factors that proprietors put into their businesses
D)  All of these go to owners of proprietor income.E) B) and C)
F) A) and B)

Exam 16: The Factors of Production

Derived demand:

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A profit-seeking firm will choose the combination of inputs that:

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The determinants of labor supply include:

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Workers compete against those who have:

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In the U.S. ,some of the most powerful unions:

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Which of the following would be considered a "leisure" activity by economists?

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The increase in the quantity of labor supplied in response to a higher wage is called the:

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

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Sadie works at a factory for $15 an hour and typically works 40 hours a week.Sadie gets a pay raise and now earns $20 an hour.She decides to work 45 hours a week at $20 an hour.Her response to the pay increase demonstrates the:

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A profit-seeking firm will choose the combination of inputs that maximizes profit,based on the:

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If the supply of another input used decreases,the marginal product of labor can:

Correct AnswerverifiedShow Answer

By comparing the value of marginal product with the marginal cost per input,a firm:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

In general,as wages increase:

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Which of the following industries has the option to be labor or capital intensive in its production process?

Correct AnswerverifiedShow Answer

If the labor market worked efficiently,then an effective minimum wage law would:

Correct AnswerverifiedShow Answer

The competitive firm's profit-maximizing quantity of labor is the quantity where:

Correct AnswerverifiedShow Answer

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

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The value of the marginal product is:

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When a worker has a rare skill or talent,supply in that labor market:

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