The purely competitive employer of resource a will maximize the profits from a by equating the:

Question 1

"Present value" refers to the:

value today of some amount of money to be received in the future.

current value of money held in a bank account.

amount to which some current amount of money will grow over time.

interest rate specified when a loan contract is signed.

1 points

Question 2

Picture Refer to the above list. The outcome in a monopsony labor market is shown by:

1.

2.

3.

4.

1 points

Question 3

(Last Word) According to Yale University's Environmental Performance Index (EPI):

countries with lower GDP per person tend to have healthier environments.

countries with higher GDP per person tend to have healthier environments.

there is no correlation between GDP per person and environmental quality.

growth in GDP per person initially improves environmental quality and then gradually reduces it.

1 points

Question 4

A BTU is the amount of energy needed to:

raise the temperature of one pound of water by one degree Fahrenheit.

boil one gallon of water for one minute.

raise the air temperature one degree Celsius for one hour.

raise the temperature of one pint of water by one degree Celsius.

1 points

Question 5

A monopsonist's wage cost in hiring an additional worker is the:

worker's wage rate.

worker's wage rate plus the wage increases paid to all workers already employed.

worker's wage rate adjusted for the lower price that must be charged for the extra output.

marginal wage cost less the wage rate.

1 points

Question 6

A profit-maximizing firm employs resources to the point where:

MRC = MP.

Resource price equals product price.

MRP = MRC.

MP = product price.

1 points

Question 7

About half of U.S. electricity is generated from:

hydroelectric.

petroleum.

nuclear energy.

coal.

1 points

Question 8

According to international comparisons, which nation had the highest hourly wages in U.S. dollar terms in 2007?

United States

Germany

Denmark

Sweden

1 points

Question 9

According to some supporters of the minimum wage, it has very small or even nonexistent negative employment effects because:

the demand for minimum wage labor is highly elastic.

it reduces turnover among minimum wage workers, prompts employers to use them more efficiently, and thus raises their average productivity.

it encourages teenagers to stay in school.

employers substitute lower fringe benefits for higher pay, keeping their compensation costs the same.

1 points

Question 10

By reducing labor turnover, unions may increase productivity because a lower turnover rate:

results in a less-experienced work force.

increases the incentive for firms to provide training to their workers.

allows firms to employ a greater number of younger, more energetic workers.

increases the incentive for firms to substitute labor for capital in the production process.

1 points

Question 11

Capitalist income (corporate profits, interest, and rent) has:

declined sharply since 1900 because of the growing strength of labor unions.

remained approximately constant since 1900.

increased significantly because of rising rents.

fallen since 1900 because of the declining importance of corporations.

1 points

Question 12

Compensating differences in wages:

compensate workers for differences in their human capital.

are wage differences that compensate for differences in the desirability of jobs.

describe the tendency for the wages of all occupations to adjust to the median level.

do not exist if jobs have different nonmonetary characteristics.

1 points

Question 13

Compensation paid in proportion to the number of units of personal output best describes:

royalties.

profit-sharing.

bonuses.

piece rates.

1 points

Question 14

Craft unions:

attempt to organize workers at all skill levels in a firm or industry.

have been declared illegal by Federal legislation.

only organize workers who have a particular skill.

attempt to increase the supply of their particular type of labor.

1 points

Question 15

Critics of minimum-wage legislation argue that it:

keeps inefficient producers in business.

reduces employment.

undermines incentives to work.

is deflationary.

1 points

Question 16

Critics of the minimum wage argue that as an antipoverty device it is "poorly targeted." By this they mean that:

the minimum wage only applies to a small percentage of the labor force.

many who benefit from the minimum wage are not poor.

the government has been unable to enforce the minimum wage.

the average level of wages in the economy is considerably higher than the minimum wage.

1 points

Question 17

Defined narrowly as wages and salaries, labor's share of the national income is about:

70 percent.

53 percent.

42 percent.

89 percent.

1 points

Question 18

Economic or pure rent is:

a payment made for the use of housing, factory buildings, or capital goods.

a payment for resources used in the production of "free goods."

a payment for the use of those resources whose supply is perfectly elastic.

the price paid for the use of land and other nonreproducible resources.

1 points

Question 19

Elasticity of resource demand is measured by the:

absolute change in resource quantity demanded divided by the absolute change in resource price.

percentage change in resource quantity demanded divided by the percentage change in resource price.

absolute change in resource price divided by the absolute change in resource quantity demanded.

percentage change in resource price divided by the percentage change in resource quantity demanded.

1 points

Question 20

Empirical studies suggest that the efficiency loss associated with the misallocation of labor caused by the union wage advantage is:

$6 billion per year.

about 2 percent of domestic output.

less than one-half of one percent of domestic output.

about 4 percent of domestic output.

1 points

Question 21

Extraction costs of a non-renewable resource include the:

cost of removal from the ground only.

cost of removal from the ground plus the cost of preparation for sale.

cost of removal from the ground, the cost of preparation for sale, and the cost of not being able to extract and sell the resource in the future.

cost of removal from the ground plus replanting costs.

1 points

Question 22

Forestry companies typically harvest and replant an area when trees are:

very young and growing slowly.

middle aged and growing rapidly.

near the end of their rapid growth period.

extremely old and about to die anyway.

1 points

Question 23

Henry George advocated a single tax on:

real capital.

entrepreneurial profits.

land.

labor income.

1 points

Question 24

In fisheries management, a fishery is defined as:

an operation that breeds and releases fish and other marine animals into the wild.

a stock of fish or other marine animals that can be thought of as a logically distinct group.

a company that harvests fish or other marine animals.

a government organization that regulates the harvesting of fish and other marine animals.

1 points

Question 25

In his book Progress and Poverty, Henry George argued that:

poverty is associated with the personal characteristics of individuals and therefore cannot be remedied by government antipoverty programs.

economic rent could be heavily taxed without impairing the supply of land or therefore the productive capacity of the economy.

rents should not be taxed because rental income is the basic source of saving, which ultimately permits a high level of investment and economic growth.

taxes on rents are undesirable because they have a severe disincentive effect on landlords.

1 points

Question 26

In the United States, the rate of unionization is:

higher in mining than in government.

lower in transportation than agriculture.

higher in transportation than in retail trade.

lower in government than in finance, insurance, and real estate.

1 points

Question 27

In the United States:

whites have higher unionization rates than African-Americans.

men have higher unionization rates than women.

managers have higher unionization rates than transportation workers.

workers in mining have higher unionization rates than workers in government.

1 points

Question 28

In the context of labor markets, shirking refers to:

the nonmonetary disadvantages of certain jobs.

the neglecting or evading of work.

the elimination of monitoring costs.

any scheme where pay is directly related to worker output.

1 points

Question 29

Interest is the:

price paid for the use of money.

opportunity cost of time.

expectation of a future return on investment.

reward for consuming rather than saving.

1 points

Question 30

Marginal product is:

the output of the least skilled worker.

a worker's output multiplied by the price at which each unit can be sold.

the amount an additional worker adds to the firm's total output.

the amount any given worker contributes to the firm's total revenue.

1 points

Question 31

Marginal resource cost is:

the increase in total resource cost associated with the production of one more unit of output.

the increase in total resource cost associated with the hire of one more unit of the resource.

total resource cost divided by the number of inputs employed.

the change in total revenue associated with the employment of one more unit of the resource.

1 points

Question 32

Marginal revenue product measures the:

amount by which the extra production of one more worker increases a firm's total revenue.

decline in product price that a firm must accept to sell the extra output of one more worker.

increase in total resource cost resulting from the hire of one extra unit of a resource.

increase in total revenue resulting from the production of one more unit of a product.

1 points

Question 33

Occupational licensing:

functions essentially the same as inclusive unionism.

attracts large numbers of workers and therefore depresses wages.

often restricts occupational entry and raises the incomes of license holders.

has been declared illegal in the majority of states.

1 points

Question 34

Other things equal, biodiesel becomes economically viable (as or less costly than using oil) when oil prices reach _____ or more per barrel.

$60

$80

$100

$120

1 points

Question 35

Other things equal, ethanol made from corn becomes economically viable (as or less costly than using oil) when oil prices reach _____ or more per barrel.

$60

$80

$100

$120

1 points

Question 36

Over the past two decades, total and per capita water use in the United States have:

both increased.

leveled off and fallen, respectively.

fallen and leveled off, respectively.

increased and fallen, respectively.

1 points

Question 37

Power plants with the lowest operating costs tend to:

have the lowest fixed costs in terms of construction.

have the highest fixed costs in terms of construction.

operate on the smallest scale of energy production.

generate the cleanest energy.

1 points

Question 38

Productive inputs that are actually or virtually fixed in supply are known as:

renewable natural resources.

natural capital.

non-renewable natural resources.

alternative fuels.

1 points

Question 39

Pure or economic profit is:

the amount by which accounting profits exceed normal profits.

determined by subtracting explicit costs from total revenue.

the return required to retain entrepreneurial talent in some particular line of production.

the return to any resource the supply of which is perfectly inelastic.

1 points

Question 40

Relative to 1800, today in the world there are:

more people but lower per-capita consumption.

more people but the same per-capita consumption.

more people and higher per-capita consumption.

the same number of people but higher per-capita consumption.

1 points

Question 41

Resource pricing is important because:

resource prices are a major determinant of money incomes.

resource prices allocate scarce resources among alternative uses.

resource prices, along with resource productivity, are important to firms in minimizing their costs.

of all of these reasons.

1 points

Question 42

Since 1850, the:

supply and demand for productive resources have grown at the same rate.

supply of productive resources has grown faster than the demand for those resources.

demand for productive resources has grown faster than the supply of those resources.

supply of productive resources has increased, while the demand has fallen.

1 points

Question 43

Since 1950, the energy efficiency of the United States economy in terms of producing goods and services has:

not changed.

more than doubled.

risen about 50 percent.

risen more than threefold.

1 points

Question 44

Since 1960, real hourly compensation in the United States has approximately:

remained the same.

risen by 40 percent.

doubled.

tripled.

1 points

Question 45

State right-to-work laws:

permit employers to hire nonunion workers only if union labor is unavailable.

prohibit employers from discriminating against minority groups in hiring workers.

prohibit unions from discriminating against minority groups in recruiting members.

make compulsory union membership (for example, a union shop) illegal.

1 points

Question 46

The "time-value of money" refers to the fact that:

a given amount of money becomes more valuable over time.

a given amount of money is more valuable the sooner it is obtained.

people expect monetary compensation for their labor time.

a given amount of money today is equivalent to a smaller amount of money in the future.

1 points

Question 47

The MRP curve for labor:

intersects the firm's labor demand curve from above.

is the firm's labor demand curve.

lies below the firm's labor demand curve.

lies above the firm's labor demand curve.

1 points

Question 48

The MRP curve for labor:

is downsloping and shows the relationship between wage rates and the quantity of labor demanded.

is perfectly elastic if the firm is selling its output competitively.

is upsloping and lies above the labor supply curve.

will shift location when the wage rate changes.

1 points

Question 49

The change in a firm's total revenue that results from hiring an additional worker is measured by:

marginal product.

marginal revenue.

marginal revenue product.

average revenue product.

1 points

Question 50

The demand for land is:

perfectly elastic.

perfectly inelastic.

upsloping.

downsloping.

1 points

Question 51

The elasticity of resource demand measures the:

responsiveness of workers to changes in wage rates.

responsiveness of producers to changes in resource prices.

ratio of marginal revenue product to resource price.

sensitivity of marginal revenue product to changes in product price.

1 points

Question 52

The incentive function of prices:

indicates that price increases bring forth more of a resource.

is the idea that competitive markets will always clear.

applies to all resources.

only applies to land.

1 points

Question 53

The marginal productivity theory of income distribution has been criticized because:

the resulting distribution of income is likely to be too equal to maintain production incentives.

income from inherited property is inconsistent with the theory.

purely competitive conditions characterize most resource markets.

it fails to recognize that resource demand is derived from product demand.

1 points

Question 54

The marginal productivity theory of income distribution suggests that:

government should subsidize the most productive workers through a system of transfer payments.

each individual should receive income based on his contribution to total output.

resource owners should receive income based on the idea of "from each according to his ability, to each according to his wants."

resource owners should receive income based upon their needs.

1 points

Question 55

The marginal revenue product schedule is:

the same whether the firm is selling in a purely competitive or imperfectly competitive market.

the firm's resource demand schedule.

the firm's resource supply schedule.

upsloping.

1 points

Question 56

The purely competitive employer of resource A will maximize the profits from A by equating the:

price of A with the MRP of A.

marginal productivity of A with the MRC of A.

marginal productivity of A with the price of A.

price of A with the MRC of A.

1 points

Question 57

The real interest rate can be estimated by:

subtracting the pure interest rate from the nominal interest rate.

dividing the nominal interest rate by the consumer price index.

subtracting the nominal interest rate from the rate of inflation.

subtracting the rate of inflation from the nominal interest rate.

1 points

Question 58

The real rate of interest is the interest rate:

charged on long-term government bonds.

associated with a riskless loan.

that large commercial banks charge their best customers.

after adjustment has been made for inflation.

1 points

Question 59

The substitution effect indicates that a profit-seeking firm will use:

more of an input whose price has fallen and less of other inputs in producing a given output.

more of all inputs if production costs fall.

more of those inputs whose marginal productivity is the greatest.

less of an input whose price has fallen and more of other inputs in producing a given output.

1 points

Question 60

The supply of land is:

almost perfectly inelastic.

negatively sloped.

relatively elastic.

perfectly elastic.

1 points

Question 61

The total fertility rate necessary to keep the population constant is approximately equal to:

1.0.

1.5.

2.1.

3.0.

1 points

Question 62

The total fertility rate:

measures the average number of children that a woman is expected to have during her lifetime.

measures the average number of children that each couple is expected to have during their lifetime.

equals the rate of population change over time.

rises as income rises.

1 points

Question 63

The user cost of extracting a non-renewable resource is:

the sum of the dollar expenditures incurred to extract the resource.

the cost of not being able to extract it in the future if it is extracted and sold in the present.

the selling price of the resource to the companies using it to produce goods and services.

directly proportional to how much of the non-renewable resource remains.

1 points

Question 64

The value today of a sum of money to be received in the future is referred to as:

the future value of that sum of money.

the present value of that sum of money.

compound interest.

the time-value of money.

1 points

Question 65

To say that land rent performs no incentive function means that:

higher rental payments will not bring forth a larger quantity of land.

rent is not a cost to specific firms but it is a cost from the standpoint of the economy as a whole.

rent does not allocate land in terms of productive efficiency.

rent tends to allocate land into the most productive uses.

1 points

Question 66

Usury laws:

allocate funds from low-productivity to high-productivity investments.

establish a legal ceiling on interest rates.

make more funds available to low-income borrowers.

create a surplus of loanable funds.

1 points

Question 67

What is the relationship between living standards and birthrates?

The relationship is negative at low levels of income, but becomes increasingly positive as incomes rise.

They are unrelated.

The relationship is positive (directly related).

The relationship is negative (inversely related).

1 points

Question 68

When the elasticity coefficient for resource demand is greater than one, resource demand is:

inelastic.

elastic.

unit-elastic.

perfectly inelastic.

1 points

Question 69

When the elasticity coefficient for resource demand is less than one, resource demand is:

inelastic.

elastic.

unit-elastic.

infinitely elastic.

1 points

Question 70

Which of the following bargaining tactics is illegal?

a lockout

a strike

refusal to meet with union representatives

hiring strikebreakers

1 points

Question 71

Which of the following is a market imperfection that might explain persistent wage differentials within an occupation?

geographical immobility of workers

readily available information about job opportunities and pay

principal-agent problems

compensating wage differentials

1 points

Question 72

Which of the following is considered a non-renewable natural resource?

Solar power.

Coal.

Oceans.

Aquifers.

1 points

Question 73

Which of the following is not a component of the demand for loanable funds?

household purchases of housing and durable consumer goods

business purchases of capital goods

government financing of the public debt

household saving

1 points

Question 74

Which of the following is not a source of loanable funds?

the saving of households

business saving

commercial bank lending

government budget deficits

1 points

Question 75

Which of the following is true about U.S. energy consumption and per capita real GDP since 1988?

Per capita energy consumption and per capita real GDP have both risen.

Per capita consumption of energy has been relatively constant, while per capita real GDP has risen.

Per capita energy consumption and per capita real GDP have both fallen.

Per capita energy consumption has fallen, while per capita real GDP has risen.

1 points

Question 76

Which of the following occupations is among the ten projected most rapidly declining U.S. occupations in terms of percentage increases?

medical assistants

veterinarians

college professors

postal service workers

1 points

Question 77

Which of the following occupations is not among the ten projected fastest growing U.S. occupations in terms of percentage increases?

school teachers

data communication analysts

athletic trainers

personal and home care aides

1 points

Question 78

Which of the following occupations is projected to be the fastest growing in the U.S. in terms of percentage increases?

medical assistants

biomedical engineers

home health aides

software engineers

1 points

Question 79

Which of the following statements is correct?

Economic profits can properly be regarded as the salaries received by the hired managers of corporations.

Economic rent is a price paid for productive land resources whose supply is perfectly inelastic.

Economic profits would be nonexistent in a dynamic, purely competitive economy.

Economic or pure profit is the minimum return which entrepreneurs must receive to continue in a particular line of production.

1 points

Question 80

Which of the following tactics is most associated with the demand-enhancement union model?

Reducing the price of inputs that are substitutes for union workers.

Lobbying for increases in public expenditures on the product it is producing.

Restricting the number of workers allowed to work in the industry.

Increasing the price of products that are complements for the one it is producing.

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