Pennsylvania's largest grower of fresh-to-market tomatoes announced in March 2009 he will no longer produce the crop because he can't find enough workers to harvest it. Though his tomato pickers made an average of $16
59 per hour last year, he said the relatively high wage is not enough to attract local labor to work the fields. In the market for tomato workers, what is TRUE? A) $16.59 is above the equilibrium wage rate
B) $16.59 is the equilibrium wage rate
C) $16.59 is below the equilibrium wage rate
D) Cannot determine where the equilibrium wage rate is in comparison to $16.59 without more information.
C
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Tom and Mary own a perfectly competitive tomato farm. They can hire different numbers of college students to help plant, cultivate, and harvest the tomatoes. The above table gives their marginal product schedule
a) If the price of a pound of tomatoes is $2 a pound, complete the first value of marginal product column in the table. If Tom and Mary must pay their workers $10 an hour, how many workers do they hire? b) If the price of a pound of tomatoes falls to $1 a pound, complete the second value of marginal product column in the table. If Tom and Mary still must pay their workers $10 an hour, how many workers do they hire? c) When the price of a pound of tomatoes falls, what happens to Tom and Mary's demand for labor curve?
The above figure depicts the Edgeworth box for two individuals, Al and Bruce. Considering only the labeled points, point c is a possible equilibrium
A) only if it is the endowment. B) only if point a is the endowment. C) if either point a or b is the endowment. D) only if point d is the endowment.
Suppose that the marginal cost of an additional ton of steel produced by a Japanese firm is the same whether the steel is set aside for domestic use or exported abroad
If the price elasticity of demand for steel is greater abroad than it is in Japan, which of the following will be correct? A) The Japanese firm will sell more steel abroad than they will sell in Japan. B) The Japanese firm will sell more steel in Japan than they will sell abroad. C) The Japanese firm will sell steel at a lower price abroad than they will charge domestic users. D) The Japanese firm will sell steel at a higher price abroad than they will charge domestic users. E) Insufficient information exists to determine whether the price or quantity will be higher or lower abroad.
Suppose you are the manager of Natural Oils, a firm that specializes in healthy skin oils. To make your oils, you purchase avocado pits from guacamole manufacturers. If the demand for guacamole increases, this will cause the production of avocado pits to ________ and the price of avocado pits to ________.
A) increase; fall B) decrease; fall C) increase; rise D) decrease; rise