Question :
71) Refer to Figure 13-2. Suppose this firm initially has : 1384277
71) Refer to Figure 13-2. Suppose this firm initially has the marginal revenue product curve MRP1. One reason that the curve could shift to MRP3 is
A) an increase in demand for the firm’s output, copper plumbing pipe.
B) a decrease in the market price of copper plumbing pipe.
C) a decrease in the supply of labour.
D) an increase in the wage rate.
E) an increase in the marginal product of labour.
72) Refer to Figure 13-2. Suppose this firm has the marginal revenue product curve MRP1. At a wage rate of $12, the profit-maximizing firm will hire ________ units of labour.
A) 100
B) 120
C) 140
D) 160
E) 180
73) Refer to Figure 13-2. Suppose this firm is facing MRP1, a wage rate of $12 per hour and is employing 150 units of labour. At this level of employment,
A) the last unit of labour is adding less to the firm’s cost than it is adding to the firm’s revenue, so it should increase the use of labour.
B) the last unit of labour contributes as much to the firm’s costs as to the firm’s revenues and so the firm should not change its use of labour.
C) the last unit of labour is adding more to the firm’s cost than it is adding to the firm’s revenue, so it should reduce the use of labour.
D) the firm has shifted the MRP curve to MRP2.
E) the firm has shifted the MRP curve to MRP3.
74) Refer to Figure 13-2. Suppose this profit-maximizing firm is facing MRP1 and a wage rate of $12 per hour. Now suppose there is, simultaneously, an increase in demand for copper plumbing pipe (such that MRP shifts to MRP2), and an increase in the wage rate to $16 per hour. The firm should
A) employ 20 more units of labour.
B) employ 40 more units of labour.
C) employ the same number of units of labour.
D) employ 40 fewer units of labour
E) employ 20 fewer units of labour.
75) Refer to Figure 13-3. This factor market is in equilibrium at point B. What is the marginal revenue product of the 40th unit of the factor employed?
A) $8 multiplied by the price of the product
B) $320
C) $8
D) the marginal product of the 40th unit employed multiplied by the wage
E) $8 multiplied by the marginal revenue of the 40th unit employed
76) Refer to Figure 13-3. If the supply and demand curves for the factor are as shown in the diagram, but the wage being paid is $9, and the market is at point C,
A) the wage is higher than the factor’s marginal revenue product, and firms will reduce the amount of the factor employed.
B) the wage is higher than the factor’s marginal product, and firms will reduce the amount of the factor employed.
C) the marginal revenue product is not equal to the marginal cost of the factor and firms will increase the amount of the factor employed.
D) the demand curve will shift to the right until equilibrium factor price and quantity are re-established.
E) the demand curve will shift to the left until equilibrium factor price and quantity are re-established.
77) Other things being equal, if it becomes more difficult to substitute capital for labour in the production of cell phones, the demand curve for labour in that industry
A) will shift parallel to the left.
B) will shift parallel to the right.
C) will remain unchanged.
D) will become more elastic.
E) will become more inelastic.
78) A monopolist will continue to increase production until the marginal cost of the variable factor is
A) greater than the marginal revenue of the firm’s output.
B) less than the marginal revenue of the firm’s output.
C) equal to zero.
D) equal to the marginal revenue product of the factor.
E) equal to the marginal revenue of the firm’s output.
79) A perfectly competitive firm will continue to increase production until the marginal cost of the variable factor is
A) greater than the marginal revenue of the firm’s output.
B) less than the marginal revenue of the firm’s output.
C) equal to zero.
D) equal to the marginal revenue product of the factor.
E) equal to the marginal revenue of the firm’s output.
80) Refer to Table 13-1. How many units of this factor of production would the profit-maximizing firm hire if the price of each unit of the factor was $200?
A) 10
B) 11
C) 12
D) 13
E) It is not possible to determine with the data given.
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