Factors of Production
Which of the following most accurately represents what causes the factor demand curves to shift?
All of the above
According to the efficiency-wage model, some employers pay which of the following?
An above equilibrium wage as an incentive for better performance
A rise in the wage rate causes which of the following?
Both an income and a substitution effect on an individual's labor supply
A movement along the existing labor supply curve is driven by which of the following?
Changes in the price of labor
The labor supply curve will shift for all of the following reasons, except what?
Changes in the price of labor
Demand for a factor of production is which of the following?
Derived from the firm's output choice
Which of the following best describes the relationship that firms have with the factors of production according to the image?
firms provide goods and services to the good markets through production firms use land, labor, capital, and entrepreneurship to produce goods and services for the goods markets
What does the image best describe?
the circular flow model which shows the interplay between market forces and the factors of production
Although all countries have factors of production, land, labor, capital, and entrepreneurship, that are used to transform inputs into outputs. What is the biggest differentiating factor country by country?
the difference in which these four factors exist in intensity within a country
Which of the following best describes the relationship that households have with the factors of production according to the image?
the wages that firms pay households allow households to purchase goods and services in the goods market households supply land, labor, capital, and entrepreneurship through the work that the do for firms
Which of the following is true according to the marginal productivity theory of income distribution?
Every factor of production is paid its equilibrium value of the marginal product.
How are factor prices set?
In factor markets
Unions are typically which of the following?
Organizations of workers that try to raise wages and improve working conditions for their members by bargaining collectively
If a firm produces t-shirts, what will their factors of production be?
Workers and machines
