Question 1

Graph 18-2 
-Refer to Graph 18-2.If the price of apples increases, wage will:

Accepted Answer

A)  fall and less apple pickers will be hired
B)  fall and more apple pickers will be hired
C)  rise and less apple pickers will be hired
D)  rise and more apple pickers will be hiredE) A) and C)
F) B) and C)

Question 2

Firms pay out all of their earnings in the form of interest and dividend payments.

Accepted Answer

A) True 
 B)False

Question 3

When workers are able to augment their stock of human capital, they can expect to:

Accepted Answer

A)  decrease the value of their marginal product of labour
B)  increase the final product price
C)  receive higher wages that reflect an increase in the value of their marginal product
D)  increase their value of marginal product, but this is unlikely to lead to higher wagesE) A) and D)
F) A) and C)

Question 4

When a profit-maximising firm makes a decision to employ a worker, that decision is based on:

Accepted Answer

A)  the familial relationship between the employer and the employee
B)  how much output the worker can produce
C)  the individual contribution that the worker makes to the profit of the firm
D)  the total output produced by the firmE) All of the above
F) None of the above

Question 5

If there is a change in the supply of labour there is no change to the earnings from capital and land.

Accepted Answer

A) True 
 B)False

Question 6

According to the information provided, what is Amy's opportunity cost of taking an hour off from work and going surfing during the summer months?

Accepted Answer

A)  less than $20
B)  $20
C)  $25
D)  between $20 and $25E) C) and D)
F) B) and D)

Question 7

In the fishing industry, the capital stock includes the fishing-boats, nets and lines.

Accepted Answer

A) True 
 B)False

Question 8

An upward sloping supply curve for labour means that to get workers to work, more wages must increase.

Accepted Answer

A) True 
 B)False

Question 9

The equilibrium rental income paid to landowners at any point in time equals the:

Accepted Answer

A)  marginal product of land
B)  value of the marginal product of land
C)  purchase price of land
D)  wage paid to labourersE) B) and C)
F) All of the above

Question 10

Labour markets are governed by the force(s)  of:

Accepted Answer

A)  supply and demand
B)  regulation and supply
C)  demand only
D)  supply onlyE) None of the above
F) A) and B)

Question 11

According to the information provided, if Amy takes more hours of leisure in the summer than in the winter we can assume that the:

Accepted Answer

A)  income effect dominates the substitution effect
B)  substitution effect dominates the income effect
C)  leisure effect dominates the work effect
D)  income effect equals the substitution effectE) C) and D)
F) A) and B)

Question 12

Which of the following statements is true of factor markets?
(i)  when the supply of a factor falls, its equilibrium price falls
(ii)  when the supply of a factor rises, its equilibrium price falls
(iii)  when the supply of a factor falls, its equilibrium price rises

Accepted Answer

A)  (i)  and (ii) 
B)  (ii)  and (iii) 
C)  (i)  and (iii) 
D)  (i) , (ii)  and (iii) E) A) and D)
F) C) and D)

Question 13

How much labour will a competitive, profit-maximising firm hire?

Accepted Answer

A)  the firm will hire until marginal product equals the wage
B)  the firm will hire until the price of the final good equals the wage
C)  the firm will hire until the value of the marginal product equals the wage
D)  the firms will hire until the price of the final good equals the marginal productE) A) and D)
F) All of the above

Question 14

A worker's contribution to a firm's revenue is measured directly by the worker's:

Accepted Answer

A)  value of marginal product
B)  marginal product multiplied by his/her wage
C)  marginal product minus his/her wage
D)  contribution to outputE) C) and D)
F) A) and B)

Question 15

Which of the following events would cause an increase in the labour supply curve?

Accepted Answer

A)  a lower retirement age
B)  more married women deciding to work
C)  fewer married men deciding to work
D)  tighter restrictions on immigration policyE) B) and C)
F) A) and D)

Question 16

If the government designates certain areas within a community to be wetlands, and therefore illegal to build upon, what happens to land not classified as wetlands within the community?
(i)  the marginal product of land will fall
(ii)  the marginal product of land will rise
(iii)  the price of land will rise

Accepted Answer

A)  (i)  and (ii) 
B)  (ii)  and (iii) 
C)  (i)  and (iii) 
D)  (ii)  onlyE) A) and C)
F) B) and C)

Question 17

In general, less productive workers are paid less than more productive workers.

Accepted Answer

A) True 
 B)False

Question 18

A key determinant of labour productivity is:

Accepted Answer

A)  the market for final product demand
B)  the amount of physical capital available to workers
C)  the cultural value of work effort
D)  labour market supplyE) A) and B)
F) All of the above

Question 19

The demand curve for each factor reflects the marginal productivity of that factor.

Accepted Answer

A) True 
 B)False

Question 20

In the Australian economy most labour services are:

Accepted Answer

A)  final goods
B)  inputs into other goods
C)  imports
D)  outputsE) A) and D)
F) A) and C)

Exam 19: The Markets for the Factors of Production

A worker's contribution to a firm's revenue is measured directly by the worker's:

Correct Answer
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According to the information provided, what is Amy's opportunity cost of taking an hour off from work and going surfing during the summer months?

Correct Answer
verified

Firms pay out all of their earnings in the form of interest and dividend payments.

Correct Answer
verified

The demand curve for each factor reflects the marginal productivity of that factor.

Correct Answer
verified

Which of the following statements is true of factor markets? (i) when the supply of a factor falls, its equilibrium price falls (ii) when the supply of a factor rises, its equilibrium price falls (iii) when the supply of a factor falls, its equilibrium price rises

Correct Answer
verified

Which of the following events would cause an increase in the labour supply curve?

Correct Answer
verified

Graph 18-2 -Refer to Graph 18-2.If the price of apples increases, wage will:

Correct Answer
verified

If there is a change in the supply of labour there is no change to the earnings from capital and land.

Correct Answer
verified

Correct Answer
verified

When workers are able to augment their stock of human capital, they can expect to:

Correct Answer
verified

The equilibrium rental income paid to landowners at any point in time equals the:

Correct Answer
verified

A key determinant of labour productivity is:

Correct Answer
verified

In the Australian economy most labour services are:

Correct Answer
verified

Labour markets are governed by the force(s) of:

Correct Answer
verified

In the fishing industry, the capital stock includes the fishing-boats, nets and lines.

Correct Answer
verified

According to the information provided, if Amy takes more hours of leisure in the summer than in the winter we can assume that the:

Correct Answer
verified

When a profit-maximising firm makes a decision to employ a worker, that decision is based on:

Correct Answer
verified

An upward sloping supply curve for labour means that to get workers to work, more wages must increase.

Correct Answer
verified

In general, less productive workers are paid less than more productive workers.

Correct Answer
verified

How much labour will a competitive, profit-maximising firm hire?

Correct Answer
verified

Exam 19: The Markets for the Factors of Production

A worker's contribution to a firm's revenue is measured directly by the worker's:

Correct AnswerverifiedShow Answer

According to the information provided, what is Amy's opportunity cost of taking an hour off from work and going surfing during the summer months?

Correct AnswerverifiedShow Answer

Firms pay out all of their earnings in the form of interest and dividend payments.

Correct AnswerverifiedShow Answer

The demand curve for each factor reflects the marginal productivity of that factor.

Correct AnswerverifiedShow Answer

Which of the following statements is true of factor markets? (i) when the supply of a factor falls, its equilibrium price falls (ii) when the supply of a factor rises, its equilibrium price falls (iii) when the supply of a factor falls, its equilibrium price rises

Correct AnswerverifiedShow Answer

Which of the following events would cause an increase in the labour supply curve?

Correct AnswerverifiedShow Answer

Graph 18-2 -Refer to Graph 18-2.If the price of apples increases, wage will:

Correct AnswerverifiedShow Answer

If there is a change in the supply of labour there is no change to the earnings from capital and land.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

When workers are able to augment their stock of human capital, they can expect to:

Correct AnswerverifiedShow Answer

The equilibrium rental income paid to landowners at any point in time equals the:

Correct AnswerverifiedShow Answer

A key determinant of labour productivity is:

Correct AnswerverifiedShow Answer

In the Australian economy most labour services are:

Correct AnswerverifiedShow Answer

Labour markets are governed by the force(s) of:

Correct AnswerverifiedShow Answer

In the fishing industry, the capital stock includes the fishing-boats, nets and lines.

Correct AnswerverifiedShow Answer

According to the information provided, if Amy takes more hours of leisure in the summer than in the winter we can assume that the:

Correct AnswerverifiedShow Answer

When a profit-maximising firm makes a decision to employ a worker, that decision is based on:

Correct AnswerverifiedShow Answer

An upward sloping supply curve for labour means that to get workers to work, more wages must increase.

Correct AnswerverifiedShow Answer

In general, less productive workers are paid less than more productive workers.

Correct AnswerverifiedShow Answer

How much labour will a competitive, profit-maximising firm hire?

Correct AnswerverifiedShow Answer

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