Unit 1 Chapter 4 Quiz Labor and Financial Markets

Improvements in the productivity of labor will tend to:

A. decrease wages B. decrease the supply of labor C. increase wages D. increase the supply of labor "C"

Steel mill wage costs increase by 18 percent over a year. What is the likely economic effect on the market for steel?

A. There is an increase in the cost of producing steel, which shifts the supply curve of steel to the right, thereby increasing the price of steel. B. There is an increase in the cost of producing steel, which shifts the supply curve of steel to the left, thereby increasing the price of steel. C. There is a decrease in the cost of producing steel, which shifts the supply curve of steel to the left, thereby increasing the price of steel. D. The increase in wage costs will shift the demand curve for steel to the left, increasing the cost of steel. "B"

Which of the following will not result in a leftward shift of the market demand curve for labor?

A. a decrease in labor productivity B. a decrease in demand for the firm's product C. an increase in the wage rate D. a decrease in the firm's product price "C"

Which of the following results in a rightward shift of the market demand curve for labor?

A. a decrease in labor productivity B. a decrease in the firm's product price C. an increase in the wage rate D. an increase in demand for the firm's product "D"

Which of the following will not result in a rightward shift of the market supply curve for labor?

A. a decrease in non-wage income B. an increase in the working-age population C. an increase in labor productivity D. an increase in immigration "C"

A more efficient means of processing algae to produce an anticancer drug is discovered. As a result, the supply curve for the drug will:

A. shift to the right, increasing the price of the drug. B. shift to the left, increasing the price of the drug. C. shift to the right, decreasing the price of the drug D. shift to the left, decreasing the price of the drug. "C"

When consumers and businesses have greater confidence that they will be able to repay in the future, _______________________.

A. the quantity demanded of financial capital at any given interest rate will remain unchanged. B. the quantity demanded of financial capital at any given interest rate will shift to the left. C. the quantity demanded of financial capital at any given interest rate will shift to the right. D. the quantity demanded of financial capital at any given interest rate will achieve equilibrium. "C"

In the market for labor. What happens to real wages when there is an increase in the demand curve?

A. will stay the same B. will decrease C. will increase D. may increase, decrease or stay the same depending on the relative slopes. "C"

The �law of supply� functions in labor markets; that is, a higher __________ for labor leads to a higher quantity of labor supplied.

A. price B. demand C. supply D. quantity "A"

As the __________ substitute for low-skill labor becomes available, the demand curve for low-skill labor will shift to the left.

A. technology B. high-skill labor C. lower wage D. market "A"