Which of the following is a reason why the wage rate of high-skilled workers exceeds the wage rate of low-skilled workers?
A) The market for high-skilled workers is more competitive than the market for low-skilled labor.
B) The demand for high-skilled workers exceeds the demand for low-skilled workers.
C) The number of high-skilled workers exceeds the number of low-skilled workers.
D) Low-skilled workers often are in the process of acquiring more human capital.
B
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The assumption that the magnitude of the slope of an indifference curve decreases moving to the right along the indifference curve is known as the assumption of
A) the price effect. B) a diminishing marginal rate of substitution. C) an increasing marginal rate of substitution. D) an indifference curve effect.
The market structure in which strategic considerations are most important is
A) monopolistic competition. B) oligopoly. C) pure competition. D) pure monopoly.
For a monopoly, when the price effect outweighs the quantity effect of increased production:
A. total revenues will increase. B. the demand must be price inelastic. C. marginal revenue must be increasing. D. All of these statements are true.
Unions have the power to
A. set all working rules. B. increase the firm’s total taxes. C. push wages above competitive levels at times. D. make a firm nationalized.