Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 19, Problem 2MCQ
To determine
To choose:
The option that correctly explains the cause for the increase in the value of the marginal product of labor.
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6. The demand for will decrease in response to an Increase productivity b. better training of all laborers c. a decrease in the supply of labor d. decreased demand in markets for consumer goods and services 7. In a purely competitive market for economic resources, a firm's marginal revenue product curve for a factor could decrease as a result of an increase in the resource's marginal product b. decrease in the demand for the firm's product Cincrease in the prices of all other resource inputs d. decrease in the supply curve for the economic resource 8. Other things being equal. If a once - competitive firm attains a high degree of monopoly power. its resource demand curve will a. become perfectly inelastic b. remains perfectly elastic c. become more elastic d. become more inelastic 9. Other things being the same if the demand for labor is inelastic a decreases in wage rates will result in greater payrolls b. increases in wage rates will result in greater payrolls c. decreases in wage…
For each of the following determine the impact on the demand or the supply of labor and the effect on the equilibrium wage and quantity of labor employed.
a. An increase in the price of capital.
b. A union is formed which uses collective bargaining to obtain higher wages for its members.
c. The marginal productivity of workers rises.
d. People desire leisure more than ever before (e.g. it is Christmas Day).
e. The wages offered in other labor markets requiring similar skills are now offering substantially higher wages.
f. The fringe (non-monetary) benefits offered in this market have increased substantially.
g. The government has just adopted an "open-door' immigration policy?
A firm in a competitive market should hire workers up to the point where the value of the marginal product of labor =
a. the wage
b. total revenue
c. total cost
d. total profit
Chapter 19 Solutions
Foundations of Economics (8th Edition)
Ch. 19 - Prob. 1SPPACh. 19 - Prob. 2SPPACh. 19 - Prob. 3SPPACh. 19 - Prob. 4SPPACh. 19 - Prob. 5SPPACh. 19 - Prob. 6SPPACh. 19 - Prob. 7SPPACh. 19 - Prob. 8SPPACh. 19 - Prob. 9SPPACh. 19 - Prob. 10SPPA
Ch. 19 - Prob. 1IAPACh. 19 - Prob. 2IAPACh. 19 - Prob. 3IAPACh. 19 - Prob. 4IAPACh. 19 - Prob. 5IAPACh. 19 - Prob. 6IAPACh. 19 - Prob. 7IAPACh. 19 - Prob. 8IAPACh. 19 - Prob. 9IAPACh. 19 - Prob. 1MCQCh. 19 - Prob. 2MCQCh. 19 - Prob. 3MCQCh. 19 - Prob. 4MCQCh. 19 - Prob. 5MCQCh. 19 - Prob. 6MCQCh. 19 - Prob. 7MCQ
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- Why is the long run labor demand curve more elastic than the demand for labor in the short run? Group of answer choices a. In the long run, firms are better able to substitute capital for labor than in the short run. b. Firms are more likely to shut down in the long run c. Firms face diseconomies of scale in the short run, but economies of scale in the long run d. The demand for labor is perfectly inelastic in the short run, but perfectly elastic in the long runarrow_forwardLabour is the beginning and end of production. Explainarrow_forwardThe demand curve for a factor of production will be A. perfectly elastic if the factor is unique or it's difficult to substitute for other factors. B. perfectly elastic if its marginal product declines at constant rate. C. more elastic the more slowly its marginal product declines. D. less elastic if other factors can easily be substituted for the factor. E. less elastic if its marginal product declines slowly as more of that factor is employed.arrow_forward
- If the marginal revenue earned by a firm due to an additional unit of worker is less than the marginal cost of hiring him, _____. a.the firm should not hire the worker b.the firm should hire the worker c.the firm should not operate in the long run d.the firm should not differentiate its productsarrow_forwardWhich of the following can reduce the marginal revenue product of labor? Select one: a. A reduction in the demand for firms– products. b. A reduction in workers– supply of labor to firms. c. A decrease in firms– demand for inputs that substitute for labor. d. An increase in the extra output firms gain from adding another unit of labor.arrow_forwardQuestion 1 The market for drones is perfectly competitive. Labor is the only variable input. The fixed cost is $500. Based on the information in the table below, what is the Marginal Product of Labour when Q-300? Enter a number only, drop the $ sign. Wage rate $100 per unit of Labour Quantity of Quantity of Labour Output 2 49 119 300 15 26 51 400arrow_forward
- Which of the following determines the firm's demand curve for labor? a.The size of the labor force b.The marginal product of labor c.The total product of labor d.The average product of laborarrow_forwardEconomics Which of the following statements best describes labor demand? a. The long-run labor demand is more elastic to wage rate than the short-run labor demand. b. The labor demand of a firm is more elastic to wage rate than the labor demand of the industry to which the firm belongs. c. In the short-run, firms have little scope in adjusting capital stock. Therefore, labor demand decisions of firms rest on how the marginal revenue from labor input is compared to the marginal cost of labor input. d. All of the above.arrow_forwardEconomics Corner Coffe sells coffee at $2 and can rent espresso machines at $500 per month. It has the following production schedule: Calculate the marginal product and the value of the marginal product of each robot. Use only whole numbers. Number of Machines. Total Product Marginal Product. Marginal Product Value 500 2 700 850 950 1000 4 6 1025 How many machines should you rent? $_arrow_forward
- In part 2, part b, you solved the question with supply of labor. We haven't seen that issue.we know - profit in the short run PQ-wLlong-term profit-PQ-wL-rKarrow_forward10. The following is a total cost curve. Sketch the corresponding marginal cost curve. If the price of output is $3 and there are no fixed costs, what is the profit-maximizing level of output?arrow_forward56 48 40 32 24 16 0 - Total Cost is $ 2400 4800 7200 The graph shows the short-run cost curves for a firm in a perfectly competitive market. The firm's only variable input is labour and the wage rate is $36. If market price is $48: - profit-maximizing level of output is - Total Fixed Cost is $ - for the profit maximizing output the firm should hire - the firm's profit is $ If market price is $16: - profit-maximizing level of output is 9600 - the firm's profit is $ SMC ATC units of labour. AVCarrow_forward
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