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Test Bank for Chapter 10 Input Demand: The Labor and Land Markets {Elementary Microeconomic Theory (Econ 211) Verified Solutions
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Test Bank for Chapter 10 Input Demand: The Labor and Land Markets {Elementary Microeconomic Theory (Econ 211) Verified Solutions

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  • November 17, 2024
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  • 2024/2025
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  • elementary microeconomic theory econ 211

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11/9/24, 10:09 AM Ch10 - Testbanks




Chapter10 InputDemand:TheLaborandLandMarkets

10.1 InputMarkets:BasicConcepts
1 MultipleChoice

1) Theideathatthedemandforautoworkersstemsfromthedemandforautomobilesis
A) thevalueofthemarginalproductofautoworkers.
B) deriveddemand.
C) indirectdemand.
D) outputdemand.
Answer: B
Diff:3
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

2) DemandfortheservicesofDerekJeteris
A) horizontal.
B) unrelatedtohistrueproductivity.
C) anoutputdemand.
D) derivedfromthedemandforYankeeʹsticketswhenJeterplays.
Answer: D
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

3) SalariesofNFLquarterbacks,likeTomBrady,are
A) toohigh.
B) relatedtotheadditionalrevenuesteamownersexpecttoenjoyasaresultofhavingthem
ontheteamroster.
C) theresultofperfectlycompetitivemarkets.
D) Alloftheabovearecorrect.
Answer: B
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking




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4) Adecreaseinthewageratewillchange
A) onlytheamountoflaborhired.
B) theamountoflaboremployed,anditmayalsochangetheamountofotherinputs
employed.
C) thepricethefirmchargesfortheproduct,butitwillnotaffectthedemandforanyofthe
inputs.
D) thefirmʹsprofit- maximizingleveloutput,butnotitsusageofinputs.
Answer: B
Diff:1
Topic: InputMarkets:BasicConcepts
Skill: Fact

5) Whenalargeamountofoutputisproducedperunitoftheinput,theinputissaidtoexhibit
A) highproductivity. B) lowproductivity.
C) marginalproductivity. D) derivedproductivity.
Answer: A
Diff:1
Topic: InputMarkets:BasicConcepts
Skill: Fact

6) Thedemandfor________isaʺderiveddemand.ʺ
A) icecreamconesonahotday B) tax- freemunicipalbonds
C) ahairstylistbyasalonowner D) abirthdaycakeforyourbrother
Answer: C
Diff:3
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

7) Thedemandforinputsisaderiveddemandbecause
A) itdoesnotcomefromcompetitivemarkets.
B) itdependsonthedemandforoutputs.
C) itisderivedfromnature.
D) itisderivedfromproduction.
Answer: B
Diff:3
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking




297




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8) Acarmanufacturingcompanyadoptsanewtechnologythat,ceterisparibus,increasesthe
productivityofcapital.Atthesametime,workersunionizeanddemandhigherwages.
Assumethatforthisfirmcapitalandlaboraresubstitutable.Whichofthefollowingismost
likelytooccur?
A) Capitalwillbesubstitutedforlabor.
B) Laborwillbesubstitutedforcapital.
C) Outputincreasesasdothepricesofcapitalandlabor.
D) Outputdecreasesasdoesthepriceofcars.
Answer: A
Diff:3
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

9) Factorsofproductionthatcanbeusedtogethertoenhancetheotherʹsproductivityare
A) substitutableinputs. B) complementaryinputs.
C) duplicateinputs. D) proportionateinputs.
Answer: B
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Definition

10) Laborandcapitalaresubstitutesinproduction.Iflaborbecomesmoreeducated,then,ceteris
paribus,
A) capitalissubstitutedforlabor.
B) laborissubstitutedforcapital.
C) outputdecreasesasdoestherentalrate.
D) outputincreasesasdoesthepriceoftheoutput.
Answer: B
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

11) Iflaborandcapitalarecomplementaryinproductionandatechnologicaladvanceincreases
theproductivityofcapital,then,ceterisparibus,
A) laborproductivityislikelytofall. B) laborproductivityislikelytorise.
C) wagesarelikelytofall. D) Both(A)and(C)arecorrect.
Answer: B
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking




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12) Themarginalrevenueproduct
A) istheproductofthemarginalproductoflaborandthepriceoftheoutput.
B) eventuallyincreasesaslaborinputincreases.
C) measuresthebenefittothefirmfromhiringanadditionalunitoflabor.
D) Both(A)and(C)arecorrect.
Answer: D
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

13) Ifapetgroomingsalonhiresanadditionalgroomer,thatworkercangroom4additionalpets
perday.Theaveragegroomingfeeis$25.Themostthesalonwouldbewillingtopaythat
groomeris
A) $4perday.
B) $25perday.
C) $100perday.
D) indeterminatewiththegiveninformation.
Answer: C
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Conceptual
AACSB: ReflectiveThinking

14) Themarginalrevenueproductoflaboris
A) theadditionalrevenueafirmearnsbyemployingoneadditionalunitoflabor.
B) theadditionalprofitafirmearnsbyemployingoneadditionalunitoflabor.
C) themarginalproductofcapitaltimesthepriceoflabor.
D) theadditionalrevenuethefirmmakesbysellingoneunitoflabor.
Answer: A
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Definition

15) Ifthemarginalproductofaworkerforacalculatormanufactureris10calculators,andthe
priceofa calculatoris$10,thefirmʹsmarginalrevenueproductis
A) $1.00. B) $10.00. C) $100.00. D) $1,000.00.
Answer: C
Diff:2
Topic: InputMarkets:BasicConcepts
Skill: Analytic
AACSB: AnalyticSkills




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