Chapter 11: The Labor Market

The costs of working do NOT include what

Could have been bought with the income earned

Why does an employer's labor demand curve slope downward?

Diminishing marginal product

Which graph shows the scenario where the substitution effect dominates labor supply decisions?

Graph A

Supermarkets need to hire fewer cashiers, due to self-checkout counters. Which graph shows what happens to the labor market for cashiers?

Graph B

Consider the labor market, predict which of the following create an incentive for investment in capital?

Higher wages

The three key labor market decisions that you make do NOT include

How many workers to hire

The income effect measures

How people's choices change when they have more income

Consideration of the benefits of choosing an occupation should NOT include

If you find it easy

If a company incurs expenses to start providing childcare at work so that employees can have lunch with their preschool children, the company's demand curve for labor will shift to the

Left because employers are more expensive to the firm

The marginal revenue product of labor is equal to:

MPL X P

The marginal revenue from hiring an additional worker is known as

Marginal Revenue Product

The labor supply curve for social workers will shift to the right when:

Nonwage benefits increase for social workers

The Rational Rule for Workers is to work

One more hour as long as the wage is at least as large as the marginal benefit of another hour of leisure

In the labor market for computer programmers, the labor demand represents

The employers looking to hire programmers

Which of the following would shift the labor supply curve?

The government increases it provision of childcare services

The population of Japan is declining. What impact will this have on the labor market for optometrists in Japan?

The optometrist labor supply curve shifts leftward

The Rational Rule for Employers implies that they keep hiring until

The wage equals the marginal revenue product of the last worker hired

In a perfectly competitive labor market, employers will not pay less than the market wage because at a wage below the equilibrium

They would not be able to hire anyone

Use the data in Table: Pat's Pedicures to answer the question. If Pat uses the Rational Rule for Employers, how many nail technicians will she hire?

Three

The opportunity cost of working is

What you would have done during the time if you were not working

Alena manages a small theme park. She hires one more custodian at $450 per week, and her park is cleaner and more attractive. As a result of this improvement, ticket sales rise by 40 tickets per week. Tickets sell for $12. Use the Rational Rule for Employers to determine if hiring the extra custodian was a good move.

Yes, it was a good movie because it added more to revenue than the cost

If the demand for Ono Yo's organic frozen yogurt increases, then the _____ Ono Yo's workers will _____.

marginal revenue product of; increase

In a labor market graph, _____ is measured on the vertical axis, and _____ is measured on the horizontal axis.

wage; hours of labor