Factor Markets and Income Distribution Online Quiz Questions

A sharp increase in consumer demand for restaurant meals is most likely to produce which initial effect in the market for restaurant labor, holding other factors constant?

A worker adds 15 units of output per hour, and a firm in a perfectly competitive output market sells each unit for $12. What is the worker's marginal revenue product per hour?

Machinery is a substitute for some workers. If the price of that machinery rises substantially, what is the most likely effect on the demand for those workers?

Which TWO changes would generally shift a firm's labor-demand curve to the right? Select all correct choices.

Which TWO changes would generally shift the labor-supply curve to the right? Select all correct choices.

True or false: In a competitive labor market, a wage set below the equilibrium wage creates a shortage of labor.

True or false: An increase in a firm's product demand causes movement along its existing labor-demand curve rather than a shift of that curve.

A competitive labor market has quantity demanded $Q_{L,d}=100-2W$ and quantity supplied $Q_{L,s}=20+2W$. Enter the equilibrium wage as a number in dollars per labor unit.

Enter the economic term for the curve that shows the additional revenue generated by each additional unit of labor.

A rural hospital is the only major employer of registered nurses in its area. Explain how this labor market differs from a competitive labor market. In your response, identify the market structure, state the hospital's hiring condition, explain how it determines the wage, compare employment and wages with the competitive outcome, and discuss one way collective bargaining or a wage floor could change the result.

A firm has market power in its output market, so its marginal revenue is below its product price. Which statement correctly describes its marginal revenue product of labor?

A 20% increase in the wage reduces employment by 8%. How should labor demand be classified over this range?

True or false: Holding other determinants of labor demand constant, an increase in the wage causes a movement along the firm's existing labor-demand curve rather than shifting the curve.

A tourism boom increases consumers' demand for hotel rooms. What is the most likely immediate effect in the market for hotel workers, holding other factors constant?

True or false: If automated checkout systems replace some cashier tasks, the demand for cashier labor tends to shift left, other things equal.

A firm's output rises from 220 units to 250 units when employment increases from 5 workers to 6 workers. What is the marginal product of the sixth worker? Enter the numerical value in units.

A competitive firm faces a wage of $45 per hour. The marginal products of its first four workers are 10, 8, 5, and 2 units per hour, and the product price is $8 per unit. How many workers should the firm hire?

A worker produces 12 additional units per hour, and a perfectly competitive firm receives $15 per unit. What is the worker's marginal revenue product? Enter the numerical value in dollars per hour.

Which of the following conditions tend to make a firm's labor demand more elastic? Select all correct answers.

A 20% increase in the wage reduces employment by 8%. What is the wage elasticity of labor demand over this range? Enter the signed decimal value.

In a competitive labor market, labor demand is Q_L,d = 100 - 2W and labor supply is Q_L,s = 20 + 2W. Which equilibrium outcome is correct?

True or false: A monopsonist chooses employment where marginal revenue product equals the wage and then pays that same wage to workers.

A key piece of equipment used with workers becomes substantially more expensive. What is the most likely effect on the demand for that labor, holding other factors constant?

A firm's product demand is unchanged, but the market wage falls. What happens to the firm's labor-demand curve, holding other factors constant?

A firm in an imperfectly competitive output market has marginal revenue of $7 per unit and a worker's marginal product of 9 units per hour. What is the worker's marginal revenue product?

An occupation introduces much more flexible scheduling while labor demand is unchanged. What is the typical competitive-market effect on equilibrium wages and employment?

In a competitive labor market, labor demand is $Q_{L,d}=100-2W$ and labor supply is $Q_{L,s}=20+2W$. What is the equilibrium wage in dollars per labor unit?