ECON 1000 Questions and Answers | 2023
When we draw a supply and demand diagram describing the labor market, the supply curve
_________________ and the demand curve ________________. Answer - represent employees,
represent employers
By hiring workers based on their marginal benefits and marginal costs, the buyers in the labor market
can: Answer - maximize their profits
The labor supply curve is derived from: Answer - the willingness and ability to work specific amount of
time at alternative wage rates in a given time period, ceteris paribus
As a worker increases the amount of labor supplied, the opportunity cost of working will: Answer -
increase
The benefit of any worker to a firm can be measured best with: Answer - marginal revenue product
An effective minimum wage will: Answer - increase the amount of workers who cannot find
employmentThe general strategy of unions are to increase the supply of labor.
The general strategy of unions are to increase the supply of labor. Answer - false
When productivity of workers increase, this puts pressure on the equilibrium wage to increase. Answer -
true
The real value of the minimum wage: Answer - is impacted by inflation
Suppose that a film studio expects that hiring comedian Chris Rock to star in its next film will generate
$50 million in extra revenue relative to hiring comedian Eddie Murphy to star in the film. Chris Rock
commands $100 million to star in the film. Eddie Murphy commands $75 million to star in the film.
Ceteris paribus, based on the information, the film studio will earn the highest profits by: Answer -
hiring Chris Rock
, Which of the following is a model that shows the amount of output that can be produced with different
amounts of inputs? Answer - production function
The marginal cost of labor includes all the following except: Answer - added production
The change in total product by adding one more unit of labor is: Answer - the marginal product of labor
When adding additional inputs, the total product increases at a decreasing rate is referred as: Answer -
the law of diminishing returns
The demand of labor is derived from: Answer - the value of the marginal product of labor
The value of the marginal product of labor is: Answer - the revenue the firm receives from the additional
production of the last worker
If the marginal cost is greater than the value of the marginal product of labor then profits will increase by
employing one more unit of labor. Answer - false
The minimum wage increases the demand of workers. Answer - false
The minimum wage increases the productivity of worker Answer - false
An effective minimum wage in a labor market is when the quantity supplied of labor is greater than the
quantity demanded Answer - true
An increase in the minimum wage makes all of those willing to work at the minimum wage better off.
Answer - false
An increase in the minimum wage does not make anyone better off because employers won't hire
people if they have to pay them more. Answer - false
When we draw a supply and demand diagram describing the labor market, the supply curve
_________________ and the demand curve ________________. Answer - represent employees,
represent employers
By hiring workers based on their marginal benefits and marginal costs, the buyers in the labor market
can: Answer - maximize their profits
The labor supply curve is derived from: Answer - the willingness and ability to work specific amount of
time at alternative wage rates in a given time period, ceteris paribus
As a worker increases the amount of labor supplied, the opportunity cost of working will: Answer -
increase
The benefit of any worker to a firm can be measured best with: Answer - marginal revenue product
An effective minimum wage will: Answer - increase the amount of workers who cannot find
employmentThe general strategy of unions are to increase the supply of labor.
The general strategy of unions are to increase the supply of labor. Answer - false
When productivity of workers increase, this puts pressure on the equilibrium wage to increase. Answer -
true
The real value of the minimum wage: Answer - is impacted by inflation
Suppose that a film studio expects that hiring comedian Chris Rock to star in its next film will generate
$50 million in extra revenue relative to hiring comedian Eddie Murphy to star in the film. Chris Rock
commands $100 million to star in the film. Eddie Murphy commands $75 million to star in the film.
Ceteris paribus, based on the information, the film studio will earn the highest profits by: Answer -
hiring Chris Rock
, Which of the following is a model that shows the amount of output that can be produced with different
amounts of inputs? Answer - production function
The marginal cost of labor includes all the following except: Answer - added production
The change in total product by adding one more unit of labor is: Answer - the marginal product of labor
When adding additional inputs, the total product increases at a decreasing rate is referred as: Answer -
the law of diminishing returns
The demand of labor is derived from: Answer - the value of the marginal product of labor
The value of the marginal product of labor is: Answer - the revenue the firm receives from the additional
production of the last worker
If the marginal cost is greater than the value of the marginal product of labor then profits will increase by
employing one more unit of labor. Answer - false
The minimum wage increases the demand of workers. Answer - false
The minimum wage increases the productivity of worker Answer - false
An effective minimum wage in a labor market is when the quantity supplied of labor is greater than the
quantity demanded Answer - true
An increase in the minimum wage makes all of those willing to work at the minimum wage better off.
Answer - false
An increase in the minimum wage does not make anyone better off because employers won't hire
people if they have to pay them more. Answer - false
