How do firms estimate the demand for labor?
What will be an ideal response?
The value of the marginal product of labor (VMPL) is the demand for labor for a competitive firm. The marginal product of labor is the additional output that is produced by employing an additional worker. According to the law of diminishing returns, the marginal productivity of an additional unit of labor decreases as the quantity of labor is increased. The value of the marginal product of labor equals the marginal product of labor times the price of output. The labor demand curve is downward sloping due to the law of diminishing returns.
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The catch-up effect refers to the idea that poor countries, despite their best efforts, are not likely ever to experience the economic growth rates of wealthier countries
a. True b. False Indicate whether the statement is true or false
To finance medical care, the federal government raises the tax per pack paid by sellers of cigarettes. Other things being equal, the price of cigarettes rises because of a(n):
A. upward movement along the supply curve for cigarettes. B. rightward shift of the supply curve for cigarettes. C. downward movement along the demand curve for cigarettes. D. leftward shift of the supply curve for cigarettes.
What is the purpose of a pollution tax?
What will be an ideal response?
Under which of the following sets of circumstances is it definitely the case that the average product increases as more labor is hired?
A) Total product increases as more labor is hired. B) The marginal product is equal to the average product. C) The marginal product is positive. D) The marginal product is greater than the average product. E) The marginal product is less than the average product.