Exhibit 11-5 A perfectly competitive labor market
Quantity of Labor
(thousands)
Marginal Revenue Product
Wage Rate 5 $25.00$ 5.00 10 20.0010.00 1515.0015.00 2010.0020.00 255.0025.00?
?
In Exhibit 11-5, when the marginal revenue product is $20.00, firms should
A. continue hiring workers.
B. stop hiring workers.
C. start firing workers.
D. pay a wage above $15.00 to its workers
Answer: A
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A household's consumption choices cannot exceed limits created by
A) only the household's income. B) only the prices of the goods and services that it buys. C) both the household's income and the prices of the goods and services that it buys. D) neither the household's income nor the prices of the goods and services that it buys.
Recessions can sometimes last less than a single year
a. True b. False
Which of the following is not correct?
a. Some economists believe that business owners who emphasize profit maximization will hire the most productive workers regardless of the personal characteristics of the worker; hence, these firms will drive discriminating firms out of business. b. Two economists found that employers in Boston and Chicago were about 50 percent more likely to interview job applicants named Emily and Greg than those named Lakisha and Jamal. c. Two economists found that women were less likely to participate in an experiment where they were paid based on math skills but more likely to participate when they were paid based on reading skills; men were more likely to participate when they were paid based on math skills and less likely to participate when they were paid based on reading skills. d. Economists found that the prices of older baseball cards were about 10 percent lower when the player was black rather than white.
Suppose that the marginal cost of producing cottonseed meal is $170 per ton. If the cottonseed oil industry is perfectly competitive and in long-run equilibrium, the average total cost of producing cottonseed oil:
A. is equal to $170 per ton. B. is greater than $170 per ton. C. is less than $170 per ton. D. cannot be determined.