Micro econ Ch 11

Harold brown runs a company that sells encyclopedia sets for $250 each. When he employs 10 workers, they can sell 60 sets per week, while only 54 sets are sold when 9 workers are employed. What is the weekly marginal revenue product of the tenth worker?

$1,500

Troll corporation sells dolls for $10 each in a market that is perfectly competitive Increasing the number of workers from 100 to 101 would cause output to rise from 500 to 550 dolls per day. The marginal revenue product for the 101st worker is:

$500

Which of the following statements is true?

A derived demand for labor depends on the demand for the product labor produces B Unions can either increase demand of decrease the supply of labor. C Investment in human capital is expected to increase the demand for those workers D All of these

Which of the following is a characteristic of the marginal revenue product schedule for a resource?

A. It approximates the firms demand curve for the resource. B. It measures the change in total revenue resulting from employing an additional unit of resource. C. Its determined by multiplying the marginal physical product (MMP) of the resource by the marginal revenue (MR) of the good produced. D. All of these are true

A union can influence the equilibrium wage rate by:

A. Lobbying for lower tariffs for the raw materials/intermediate goods they use in the production process. B. Lobbying for increased tariffs on the products they make. C. Lobbying for legislation to reduce immigration. D All of these

Which of the following would be a human capital investment?

A. On-the-job training programs. B. Health care programs. C. Formal education D. All of these.

Labor unions generally lobby for

All of the above

When a company/corporation declares a bankruptcy, it generally pays its:

All of the above are correct

Which of the following most clearly illustrates the concept of derived demand?

An increase in the demand for new houses leads to an increase in the demand for construction workers

The income effects wages refers to the fact that:

As income rises, individuals will be willing to work less

Which of the following statments is true about monopsony?

C, D, and E

The substitution effect of wages refers to the fact that:

Higher wage rates encourage people to work more

Labor unions generally lobby for

Increased tariffs on the goods they make

The profit-maximizing employment level for a monopsonist occurs where:

MRP = MFC

If more and better technology is used for producing wheat in the US than in a lesser-developed country, then the:

MRP of the US workers will be higher than the MRP of the workers in the lesser developed country.

Companies/corporations can expand their capacity or increase investment through:

None of the above

What happens to the MPP of labor when the market price (MR or P) of the good produced increase?

Stays the same.

Which of the following is the most accurate definition of a worker's "marginal revenue product?"

The change in the firm's total revenue as the result of hiring an additional worker

The lower price to earnings (P/E) ratio of a company/corporation is an indication that:

The company's financial health is sound/strong.

Landowners will receive rent so long as:

The supply and demand curves for land intersects

Which of the following statements concerning the supply of labor is true?

The typical labor supply curve is upward sloping

Jim Smith runs a company that sells encyclopedia sets for $200 each When he employs 5 workers, they can sell 20 sets per week, while only 17 sets are sold when 4 workers are employed. If the wage of workers in this skill category is $500 per week, should the fifth worker be hired?

Yes, because the MRP of the fifth worker is more than $500 per week

A decrease in the marginal product/marginal physical product of labor would be represented by a(n):

decrease (shift) in labor demand.

The demand for a factor of production depends on the:

demand for the products that it helps to produce.

A monopsony will:

employ a quantity of labor where the marginal revenue product equals the marginal factor cost.

Compared to monopsonist in an input market, a perfectly competitive firm will:

hire more and pay a higher input price

An individual firm in a competitive labor market faces a(n):

horizontal labor supply curve

If The wage rate is fixed at a certain level, the:

labor supply curve is horizontal (perfectly elastic)

Compared to a competitive input market, a monopsonist will hire:

less and pay lower input price.

Given the same marginal revenue product (MRP) and supply curves, the equilibrium quantity of labor employed in a monopsonistic labor market will be:

less than that in a competitive labor market

Firms should hire additional units of a resource as long as the:

marginal revenue product of the resource exceeds (up to the level/point where MRP = MFC!!!) the cost of an additional unit of the resource.

Bond yield is equal to:

none of the above

If the price of labor falls (decreased wage rate) we can expect:

quantity demanded of labor will increase

Suppose a change in technology increases the marginal product of labor. The result is a(n):

rightward shift in the demand for labor curve

A monopoly is a sole _________, and a monopsonist is a sole _____________.

seller in a product market; buyer in a labor market

A union my attempt to obtain stricter certification requirements or longer apprenticeships. These changes would raise workers' wages because they:

shift in labor supply curve leftward

A monopsony is a:

single buyer

The marginal revenue product of a resource is:

the marginal product (MP) or marginal physical product (MMP) of the resources multiplied by the price of the product it helps to produce

A monopsonist is:

the only buyer of a resource

A monopsonist can pick the _________, while a monopolist can pick _________.

the wage it will pay; the price it will charge

The optimal hiring rule is to employ labor up to the point where:

wage = MRP