Ch 19

Which of the following is most likely an example of wage disparity due to differences in talent and ability?

Nick Saban, the football coach at the University of Alabama, earns more than the local high school football coach.

Which of the following statements is TRUE?

The value of the marginal product is the marginal product times the price.

Which of the following will NOT shift the labor supply curve?

a change in the wage rate

The key distinction between a factor of production and an input is that:

a factor of production earns income from selling its services over and over again, but an input cannot.

The firm's value of marginal product curve slopes downward:

because of diminishing returns.

If a firm hires labor such that W < VMPL, then profit:

can be increased by hiring more labor.

Alex's boss notices that with each course Alex takes, he becomes a more knowledgeable and efficient worker. This is an example of:

human capital development.

For a profit-maximizing firm at the equilibrium level of output, the VMPL bricklayers:

is equal to the market wage rate.

The equilibrium value of the marginal product of a factor is the additional value produced by the _____ unit of that factor employed in the factor market as a whole.

last

When labor is hired in a competitive market, the value of the marginal product of labor is computed by:

multiplying the price of the output by the marginal product of labor.

According to the efficiency wage model, all of the following are correct EXCEPT that efficiency wages:

reduce unemployment.

A shift in demand for a given factor of production will NOT occur if:

the price of that factor falls.

Phil's Copy Studio pays its workers $60 per day and sells poster-size copies for $10 per print. If the market wage rises to $70:

the quantity demanded of labor decreases, but the demand for labor curve does not shift

Tim works 51 hours per week, and his wage is $35 per hour. If his wage increases to $70 per hour:

the substitution effect implies that he will work more.

if a technological advance makes labor more productive and everything else stays the same, then the profit-maximizing quantity of labor:

will increase.