Question 1

An increase in the demand for houses

Accepted Answer

A)  increases the equilibrium wage of carpenters and increases the value of carpenters' marginal product of labor.
B)  increases the equilibrium wage of carpenters and decreases the value of carpenters' marginal product of labor.
C)  decreases the equilibrium wage of carpenters and increases the value of carpenters' marginal product of labor.
D)  decreases the equilibrium wage of carpenters and decreases the value of carpenters' marginal product of labor.E) A) and B)
F) A) and C)

Question 2

Suppose that a large rogue wave destroys the (thankfully unoccupied)  fleet of swordfish fishing boats docked in the Gloucester, Massachusetts harbor. What happens to the earnings of fishermen and women in Gloucester?

Accepted Answer

A)  The reduction in the supply of fishing boats increases the marginal productivities of Gloucester fishermen and women, which causes the equilibrium wage to fall.
B)  The reduction in the supply of fishing boats reduces the marginal productivities of Gloucester fishermen and women, which causes the equilibrium wage to fall.
C)  The reduction in the supply of fishing boats increases the marginal productivities of Gloucester fishermen and women, which causes the equilibrium wage to rise.
D)  The reduction in the supply of fishing boats reduces the marginal productivities of Gloucester fishermen and women, which causes the equilibrium wage to rise.E) B) and C)
F) All of the above

Question 3

Table 18-2 
-Refer to Table 18-2. The table shows the number of bracelets that can be assembled per week by various numbers of workers. If the price per bracelet in a perfectly competitive product market is $5, how many workers would the firm employ if the weekly wage rate is $375?

Accepted Answer

A)  1
B)  2
C)  3
D)  4E) A) and D)
F) A) and C)

Question 4

Of the total income earned in the U.S. economy, approximately

Accepted Answer

A)  33 percent is earned by workers, and 67 percent is earned by landowners.
B)  50 percent is earned by workers, 25 percent is earned by landowners, and 25 percent is earned by owners of capital.
C)  67 percent is earned by workers, and 33 percent is earned by owners of land and capital.
D)  90 percent is earned by workers, and 10 percent is earned by owners of land and capital.E) A) and D)
F) None of the above

Question 5

The marginal product of any factor of production depends on

Accepted Answer

A)  the quantity of the factor used.
B)  the price of the final good.
C)  the demand for the final good.
D)  All of the above are correct.E) All of the above
F) None of the above

Question 6

Suppose that a college physics experiment goes horribly wrong and releases an electronic pulse that renders all electronic equipment in the cities of Columbus, Cleveland and Cincinnati, Ohio permanently useless. No people are hurt, and no buildings are damaged. After the accident, the wages earned by Ohio workers will

Accepted Answer

A)  increase because the marginal productivities of Ohio workers will increase.
B)  decrease because the marginal productivities of Ohio workers will decrease.
C)  decrease because the marginal productivities of Ohio workers will increase.
D)  increase because the marginal productivities of Ohio workers will decrease.E) A) and D)
F) A) and B)

Question 7

Which of the following is correct? Using data from 2014,

Accepted Answer

A)  immigrants (both legal and illegal)  make up about 40 percent of the U.S. population.
B)  low-skilled immigration lowers the earnings of all workers in the United States by about 15 percent.
C)  illegal immigrants make up about 20 percent of the U.S. workforce.
D)  over 80 percent of immigrants are from Latin America and Asia.E) A) and B)
F) None of the above

Question 8

Which of the following statements is correct?

Accepted Answer

A)  Neither economic theory nor evidence from the U.S. economy suggests that there is a close link between productivity and real wages.
B)  Economic theory suggests that there is a close link between productivity and real wages, but evidence from the U.S. economy fails to confirm that link.
C)  Evidence from the U.S. economy suggests a close link between productivity and real wages, but economic theory provides no basis for such a link.
D)  Both economic theory and evidence from the U.S. economy suggest that there is a close link between productivity and real wages.E) C) and D)
F) B) and D)

Question 9

When a firm decides to retain its earnings instead of paying dividends, the stockholders necessarily suffer.

Accepted Answer

A) True 
 B)False

Question 10

If Firm X is a competitive firm in the market for labor, it has little influence over the wage it pays its employees.

Accepted Answer

A) True 
 B)False

Question 11

A monopsony firm in a labor market hires fewer workers than would a competitive firm.

Accepted Answer

A) True 
 B)False

Question 12

A competitive firm will hire workers up to the point at which the value of the marginal product of labor equals the

Accepted Answer

A)  average total cost.
B)  average variable cost.
C)  wage.
D)  price per unit of output.E) All of the above
F) A) and C)

Exam 18: The Markets for the Factors of Production

When a firm decides to retain its earnings instead of paying dividends, the stockholders necessarily suffer.

Correct Answer
verified

The marginal product of any factor of production depends on

Correct Answer
verified

Which of the following is correct? Using data from 2014,

Correct Answer
verified

A monopsony firm in a labor market hires fewer workers than would a competitive firm.

Correct Answer
verified

Of the total income earned in the U.S. economy, approximately

Correct Answer
verified

If Firm X is a competitive firm in the market for labor, it has little influence over the wage it pays its employees.

Correct Answer
verified

Correct Answer
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Which of the following statements is correct?

Correct Answer
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An increase in the demand for houses

Correct Answer
verified

Table 18-2 -Refer to Table 18-2. The table shows the number of bracelets that can be assembled per week by various numbers of workers. If the price per bracelet in a perfectly competitive product market is $5, how many workers would the firm employ if the weekly wage rate is $375?

Correct Answer
verified

A competitive firm will hire workers up to the point at which the value of the marginal product of labor equals the

Correct Answer
verified

Suppose that a large rogue wave destroys the (thankfully unoccupied) fleet of swordfish fishing boats docked in the Gloucester, Massachusetts harbor. What happens to the earnings of fishermen and women in Gloucester?

Correct Answer
verified

Exam 18: The Markets for the Factors of Production

When a firm decides to retain its earnings instead of paying dividends, the stockholders necessarily suffer.

Correct AnswerverifiedShow Answer

The marginal product of any factor of production depends on

Correct AnswerverifiedShow Answer

Which of the following is correct? Using data from 2014,

Correct AnswerverifiedShow Answer

A monopsony firm in a labor market hires fewer workers than would a competitive firm.

Correct AnswerverifiedShow Answer

Of the total income earned in the U.S. economy, approximately

Correct AnswerverifiedShow Answer

If Firm X is a competitive firm in the market for labor, it has little influence over the wage it pays its employees.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

Correct AnswerverifiedShow Answer

An increase in the demand for houses

Correct AnswerverifiedShow Answer

Table 18-2 -Refer to Table 18-2. The table shows the number of bracelets that can be assembled per week by various numbers of workers. If the price per bracelet in a perfectly competitive product market is $5, how many workers would the firm employ if the weekly wage rate is $375?

Correct AnswerverifiedShow Answer

A competitive firm will hire workers up to the point at which the value of the marginal product of labor equals the

Correct AnswerverifiedShow Answer

Suppose that a large rogue wave destroys the (thankfully unoccupied) fleet of swordfish fishing boats docked in the Gloucester, Massachusetts harbor. What happens to the earnings of fishermen and women in Gloucester?

Correct AnswerverifiedShow Answer

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