micro Exam 3 review

If the supply of loanable funds increases, the marginal revenue product of capital (MRPK) that would be needed in order to break even would:

a) fall

Which labor supply curves will bend backward at high wages?

a) only the individual labor supply curve

Brett won a scholarship competition that will award him with $1,000 today and another $1,000 next year. What is the present value of the scholarship money if the intrerest rate is 10%?

D) $1,909

Which Gini coefficient corresponds to a Lorenz curve that is bowed furthest away from the 45-degree line?

D) 0.71

Suppose that the five residents of a small village have the following incomes: $10,000; $20,000; $30,000; $40,000;$50,000. The proportion of total income earned by the lowest two quantiles is ________ and the proportion earned by the highest two quintiles is ________.

D) 20%; 60%

Income redistribution efforts such as progressive taxation and transfer payments will typically ____ income inequality, which means that the Gini coefficient will _______.

D) decrease; fall

Which characteristic does NOT describe an oligopoly?

D) economic profits being zero in the long run

The poverty thresholds in the United States are largely based on an adjusted measure of prices of which category or categories of goods?

D) food

As one progresses through his or her working life, the average income tends to ___, holding the level of education constant.

D) rise then fall

Which form of financial capital involves giving up ownership in a company?

D) shares of stock

Which career is least likely to expand in demand over the next decade?

D) steel manufacturing

Which measurement rises most quickly as more labor is hired?

D) the marginal factor cost of labor

Which of these is an example of human capital investment?

D) traveling to Beijing to study Chinese in hopes of pursuing a job at a consulate

What would happen to wages and labor if worker safety regulations were abolished, making work conditions more dangerous?

D) wages would rise and labor quantity would fall

Suppose Alco, Inc. is a monopsonist employer in the town of Alcoa, TN. Using the concept of marginal factor cost, each time Alcoa increases the number of workers it hires, it will:

a) pay a higher wage, resulting in an even higher marginal factor cost

Which of these is not a common cause of income inequality?

a) the choice of city where one lives

If an industry consisting of two firms produces a total of 12 units, the market price is $10. If 13 units are produced, the price falls to $9. Suppose the two firms form a cartel and agree to produce units each. If one firm cheats and produces 7 units, the cheating firm's revenue rises by ____ and the non-cheating firm's revenue falls by____.

a) $3; $6

Union membership in the United States rose significantly during the ___.

a) 1940s

At the price of $8, the marginal revenue of a monopolistically competitive firm is $5. If the marginal cost is $7 and the average total cost is $4, what should be the firm do to maximize profits?

a) The first should reduce output and increase price

Which policy would a Rawlsian economist not support?

a) a reduction in capital gains taxes benefiting high income taxes

Under monopolistic competition, entry typically causes price to ___ and profits to ___.

a) decrease; decrease

IF the poverty threshold for a family of four is $24,000 and the Shoenfelds earned $21,000 their income deficit is _____ and their ratio of income to poverty is ____.

b) $3,000; 0.875

Which factor would shift the market labor supply curve to the right?

b) a reduction in nonwage income

If a company is on the verge of bankruptcy and has lost its ability to issue bonds or stock die to a lack of confidence by investors, which source of financial capital might still be available?

b) private equity funding

As more hotels introduce online check-in using mobile devices and keyless room entry, the elasticity of demand for hotel front-desk staff is likely to:

b) rise

When choosing to purse college full-time, the costa that must be taken into account in a benefit-cost analysis include:

b) tuition and forgone earnings during the time in college

A firm will have a "kinked" demand curve if its decision to raise prices is ____ matched by competitors, whereas its decision to lower prices is ___ matched by competitors.

c) rarely: always

In the long run, which of the following is true for a monopolistic competitive firm?

c) Price equals average total cost and MR = MC

Which statement is most likely to be a true one?

c) Wages are the most common form of income in the U.S economy

Which of the following acts or policies was not favorable to the growth of unions?

c) Wagner Act

Poverty is least likely to be eliminated when using this form of measurement?

c) a relative poverty threshold

Which of these would NOT be categorized as "land" as a factor of production?

c) an axe used to cut down trees in a forest

Innovation leads to all of these EXCEPT:

c) an increase in the inherent amount of land and natural resources available

The word "monopolistic" in the label "monopolistic competition" refers to the fact that:

c) each firm produces a unique version of the product

When a bond's rating goes from AAA to C, this means that the price of the bonds already issued will likely ___, which will _____ its yield.

c) fall; increase

Which change in the labor market has led to more women entering the workforce?

c) improved telecommuting technologies

An example of an oligopoly is:

c) mobile wireless providers in California

Which of these describes a labor market in which most of a small town's workers are employed by one large company?

c) monopsony

If the poverty threshold for a household of 3 people is $20,000 and the Shermand earn $22,000, they would be classified as:

c) near poor

Which employer would best represent a monopsony?

d) the U.S. military