chap 11

(Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand) Use Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand. In the table, the total product of labor is shown for the hourly production of power tools. Assume that the market for power tools is perfectly competitive. If the price of a power tool is $2, the marginal revenue product of labor for the third worker is:

$80.

Use the data in Table: Wendy's Windows to answer the question. What is the marginal revenue product of the second worker?

$800 (marg product x price)

Use the data in Table: Katia's Car Wash to answer the question. When four workers are employed, the total revenue equals _____, and total cost equals _____.

$1,880, $1,600

After Giselle increased worker training at her company, the output per worker rose by 5%. What impact would this have on labor's marginal revenue product and her demand for labor?

Both marginal revenue product and demand for labor would increase.

As the price of scanners with high-resolution cameras dropped, Ford began using them instead of human inspectors to check the quality of the painted surfaces of its cars. What is the relationship between capital and labor in this example?

Labor and capital are substitutes in production.

What will happen in the market for nurses in the United States if capital equipment replaces nurse labor to monitor vital statistics on patients in hospitals?

Labor demand will decrease, resulting in lower wages and fewer hours of employment for nurses.

Better management increases worker productivity in the labor market for factory production line workers. What will happen in the labor market for production line workers?

Labor demand will increase, resulting in higher wages and more hours of employment for the workers.

Salaries for physical therapists rise more than salaries for athletic trainers. What will happen in the labor market for athletic trainers?

Labor supply will decrease, resulting in higher wages and fewer hours of employment for the trainers.

Jordan's Photography Studio pays its workers $60 per day and sells poster-size prints for $10 each. Suppose that, during the holiday season, the price of poster-size prints increases to $12 due to a shift in the demand for the product. What happens?

The demand for labor increases.

The government of Florida is considering raising the state sales tax from the current 6% to 10% starting in January of next year. If the sales tax is applied to all goods, and the state government does not change the tax on labor income, what will likely happen?

The demand for labor will decrease.

Since the advent of the digital age, the demand for in-person telephone operators has fallen dramatically. Which factor would account for this development?

an increase in the number of automated answering services.

Alex and Marilyn started Ono Yo, an organic and fresh fruit frozen yogurt truck. As the demand for organic and healthier desserts rose, demand for Ono Yo's products grew. Because of the growth in demand for Ono Yo's product, Alex's and Marilyn's

demand for workers increased.

Suppose there are diminishing returns to labor. If the quantity of labor hired by a firm increases, holding everything else constant, the _____ labor will _____.

marginal product of; fall

Carlo implemented some management changes that increased worker productivity in his company. This increased the _____ and led him to _____ workers.

marginal revenue product of labor; hire more

Use the data in Table: Wendy's Windows to answer the question. What is the marginal revenue product of the fourth worker?

not $1,200

(Table: Employment and Output in the Buckwheat Market) Use Table: Employment and Output in the Buckwheat Market. In the table, if the price of a bushel of buckwheat is $10, and the price of labor (the wage) is $120, then the profit-maximizing quantity of labor is:

not 1

Use the data in Table: Carmin's Cones to answer the question. Using the Rational Rule for Employers, the maximum profit Carmin could earn is _____. She would employ _____ workers to earn this profit.

not 1144

Use the data in Table: Larry's Lawn Mowing to answer the question. If three workers are employed, total revenue will equal _____, and total costs will be _____.

not 420 540

Your landscaping company uses labor and shovels. The price of shovels falls, and this _____ your demand for labor because labor and shovels are _____.

raises; complements

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.

Not yes b/c sales rose

(Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand) Use Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand. In the table, the total product of labor is shown for the hourly production of power tools. Assume that the market for power tools is perfectly competitive. If the price of a power tool is $2 and the market wage rate is $60 per hour, the profit-maximizing quantity of labor is _____ workers.

not six

(Table: Employees and Artisanal Carpets) Use Table: Employees and Artisanal Carpets. Suppose that you achieve your dream of opening an artisanal studio specializing in the production of hand-woven carpets. You pay $10 in fixed costs for equipment and $9 per day to each of your artists (employees) who make the carpets. If the industry is perfectly competitive, and the current market price is $1, how many carpets should you produce?

not 25

When an increase in demand for stand-up paddleboards rises, then the demand for skilled paddleboard shapers _____, and their marginal revenue product _____.

not ff

Nora, the manager of three hospital rehabilitation clinics, has the clinics adopt software that allows better tracking of supplies. This software adoption also allows therapists to spend less time gathering supplies for therapy sessions. On average, each therapist can meet with one more patient per day. The marginal revenue product of the therapists will _____, and the demand for therapists at the clinics will _____.

not inc dec

If wages fall for surgeons but not for family practice doctors, there will be _____ in the market for surgeons and _____ in the market for family practice doctors.

not leftward

Use the data in Table: Larry's Lawn Mowing to answer the question. If Larry uses the Rational Rule for Employers, how many workers will he hire?

not one

If wages rise for accountants but not for financial analysts, there will be _____ in the market for accountants and _____ in the market for financial analysts.

not rightward

(Table: Employees and Artisanal Carpets) Use Table: Employees and Artisanal Carpets. Suppose that you achieve your dream of opening an artisanal studio specializing in the production of hand-woven carpets. You pay $10 in fixed costs for equipment and $9 per day to each of your artists (employees) who make the carpets. If the industry is perfectly competitive, and the current market price is $1, how many artists should you employ?

not 2

(Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand) Use Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand. In the table, the total product of labor is shown for the hourly production of power tools. Assume that the market for power tools is perfectly competitive. The price of a power tool is $2, the market wage rate is $40 per hour, and eight workers are hired. Profit can be maximized by hiring _____ worker(s).

not one fewer

(Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand) Use Table: The Market for Power Tools, Marginal Revenue Product of Labor and Demand. In the table, the total product of labor is shown for the hourly production of power tools. Assume that the market for power tools is perfectly competitive. If the price of a power tool is $2, and the wage rate is $90 per hour, the profit-maximizing quantity of labor is _____ workers.

not six