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Factor Markets
Factor Markets
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1
_____ refers to a person who receives more education. _____ refers to a firm's new equipment.
human capital; land
human capital; natural capital
human capital; physical capital
labor; capital
2
Which of the following will cause an increase in the demand for labor?
III and IV only
I and II only
I only
III only
3
Critics of minimum-wage legislation argue that it
keeps inefficient producers in business
undermines incentive to work
reduces employment
is deflationary
4
If this labor market is monopsonistic, the wage rate and level of employment will be:
C & F
A & F
D & E
B & F
5
Derived demand is
Comes from the satisfaction of a buyer for the product
Caused by monopoly control of the inputs
Demand for an input used to produce a product
Derived from government policy
6
For a PC employer, the value of the MPC is the labor _____ curve; thus the MPC has a _______
supply; negative slope
supply; positive slope
demand; positive slope
demand; negative slope
7
Marginal product times product price is
total product
additional revenue product
marginal revenue
value of the marginal product
8
A factor demand curve will shift to the left because of
an increase in the price of the factor
a decrease in the price of the factor
a decrease in the price of the good the factor produces
an increase in the price of the good the factor produces
9
Human capital
is the same factor as labor
is natural resources made more productive by entrepreneurs
has become less important due to the progress in technology
is the improvement in labor created by education & knowledge
10
The amount that an additional unit of a factor adds to a firm's total revenue is called
value of the marginal product
marginal cost
marginal product
marginal revenue
11
To maximize profits a firm employs workers up to the point where for the last worker employed
the value of the marginal product is as high as possible
marginal product = the nominal wage rate
the value of the marginal product = the wage rate
value of the marginal product = the price per unit of output
12
Human capital is the improvement in ________ created by ________
labor; unemployment
labor; physical capital
labor; education and knowledge
physical capital; technology
13
The earnings of highly educated workers
rise slower than those of less-educated workers
rise at ~ the same rate as those of less-educated workers
stagnate earlier than do those of less-educated workers
rise more rapidly than those of less-educated workers
14
Manufactured resources such as equipment, buildings, and tools are also known as
physical capital
human capital
land
labor
15
The economic term for a sole employer in a nonunion community is
bilateral competitor
monopsonist
bilateral monopolist
monopolist
16
The law of diminishing marginal returns occurs after hiring which worker?
fifth
first
third
second
17
An increase in the demand for construction workers may come about because of a(n)
decrease in the productivity of construction workers
increase in the market wage rate for construction workers
increase in the demand for new housing
decrease in the market wage rate for construction workers
18
The demand for a factor of production is a(n)
technical demand
implicit demand
derived demand
direct demand
19
If this labor market is purely competitive, the wage rate and level of employment will be:
D & E
B & F
B & G
C & E
20
An increase in the market demand for electricians might occur if
the demand for new houses falls
the wage for electricians rises
the price of copper wiring increases
market price of electrical repair & installation increases
21
As a general rule, a profit-maximizing restaurant owner....
first; greater than
first; equal to
last; equal to
last; less than
22
If a person becomes more educated & can produce a better product, this education is called
natural resources
human capital
labor
physical capital
23
The demand for factors of production is called a
derived demand
because it is
derived by questions posed to residents during the census
derived from the available supply of factors
from demand for outputs made by factors of production
derived from the marginal cost of employing those factors
24
An increase in the demand for labor may come about because of
an increase in the price of the good labor produces
a decrease in the productivity of labor
a decrease in the price of the good labor produces
a decrease in the wage paid to labor
25
Sheila has decided to pursue her MBA. This choice of additional education is an investment in
natural resources
financial capital
human capital
labor
