Assignment 12

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Question 1 (1 point)

Which of the following is not a resource?

Labor
Entrepreneurial ability
Capital
Production
Natural resources

Question 2 (1 point)

Derived demand is

the derivative of the demand curve.
the demand for the resource that stems from the demand for the final product.
the same as effective demand.
the demand for services but not goods.
the demand for goods but not services.

Question 3 (1 point)

As explained in the text, in the market for resources, demand and supply

usually don't intersect at equilibrium.
are both controlled by households.
are both controlled by firms.
do not behave in the same way as demand and supply in product markets.
behave in exactly the same way as demand and supply in product markets.

Question 4 (1 point)

The demand curve for a resource slopes down because

as the price of the resource falls, households are more willing and more able to provide that resource.
of derived demand.
because the demand for a resource depends on the quantity of resources.
as the price of the resource falls, households are more willing and more able to use that resource.
as the price of the resource falls producers are more willing and more able to use that resource.

Question 5 (1 point)

Why might the demand for a resource's services be highly elastic?

The price elasticity of demand for the product the resource is being used to produce is highly inelastic.
The price elasticity of supply for the product the resource is being used to produce is highly elastic.
Because resources are not necessary.
The price elasticity of demand for the product the resource is being used to produce is highly elastic.
The price elasticity of supply for the product the resource is being used to produce is highly inelastic.

Question 6 (1 point)

Which of the following is not a factor in determining the price elasticity of demand for a resource?

The domestic rate of inflation for the previous year.
Number of substitutes for the resource.
Proportion of total costs constituted by the resource.
Price elasticity of demand for the product the resource is used to produce.
Time period under consideration.

Question 7 (1 point)

A decrease in the demand for labor is not likely to be due to

a decrease in the demand for the product it produces.
a decrease in the price of the product it produces.
an increase in the price of a substitute resource.
a decrease in the price of a substitute resource.
a decrease in the productivity of labor.

Question 8 (1 point)

Which of the following will most likely shift the demand curve for a resource in?

An increase in the quantity of other resources
An increase in the price of the product the resource is used for
An increase in the productivity of the resource
An increase in the number of buyers
A decrease in the price of a substitute resource

Question 9 (1 point)

The price elasticity of resource supply is equal to the

change in the resource price divided by the change in quantity supplied.
percentage change in the quantity supplied for a specific use divided by the percentage change in quantity supplied for all uses.
percentage change in the quantity supplied divided by the percentage change in resource price.
percentage change in the resource price divided by the percentage change in quantity supplied.
change in the quantity supplied divided by the change in resource price.

Question 10 (1 point)

Which of the following would not cause a change in the supply of a resource?

An increase in the number of suppliers
A change in tastes
A decrease in the number of suppliers
A change in the price of other uses of the resource
An increase in the number of buyers

Question 11 (1 point)

In the figure above, at a wage of $300 per day, then

there is a surplus of 50 workers.
there is a surplus of 100 workers.
there is a shortage of 50 workers.
there is a shortage of 100 workers.
the market is in equilibrium.

Question 12 (1 point)

Refer to the table above. If a price floor of $3.00 is imposed,

a surplus will result equal to Q_s - Q_d units.
a shortage will result equal to Q_s - Q_d.
a shortage will result equal to Q_s - Q_d units.
the price will be above the equilibrium price.
the price will be the equilibrium price of $3.50 rather than the price floor.

Question 13 (1 point)

According to the text, a firm attempting to maximize profit will acquire additional resource

until MC > 0.
until MR = MC.
until MC = 0.
until MR > 0.
until MR = 0.

Question 14 (1 point)

The marginal revenue product of labor is likely to decrease as

the market price of the product that labor produces increases.
fewer workers are employed.
more workers are employed.
the marginal product of labor increases.
the demand for the product that labor produces increases.

Question 15 (1 point)

If the marginal revenue product of the sixth worker is $2 and the marginal cost of the sixth worker is $4, then

this sixth worker should be employed but no more workers should be employed.
the firm is earning a profit from this sixth worker equal to $2.
more workers should be employed.
more workers should be employed because the firm is earning a profit from this last worker employed.
this sixth worker should be laid off.

Question 16 (1 point)

In the labor market, a monopsonist will

pay a wage equal to MRP plus MR.
pay a wage equal to MRP.
pay a wage less than MRP.
pay a wage higher than MRP.
pay a wage equal to MRP plus MP.

Question 17 (1 point)

Consider the resource market described in the figure above. At equilibrium, how many units of the resource will be hired?

Less than 10 units
10 units
Between 10 and 15 units
15 units
More than 15 units

Question 18 (1 point)

In the figure above, if this market is perfectly competitive, what would be the wage rate and the level of employment?

W₂ and L₃, respectively
W₂ and L₂, respectively
W₁ and L₂, respectively
W₃ and L₂, respectively
W₄ and L₁, respectively

Question 19 (1 point)

In the table above, assuming that a firm is allocating its resources efficiently, what is the MFC of labor?

Question 20 (1 point)

In a perfectly competitive output market, the value of the marginal product of a resource is

less than the MRP.
greater than the MRP.
equal to zero.
equal to the MRP.
rising as output rises.

Question 1 (5.00 points)

Explain the difference between a price ceiling and a price floor in the resource market. Explain how these graphs would differ.

Question 2 (5.00 points)

List and briefly describe the determinants of demand for a resource.

Copyright 2008, by the Contributing Authors. Cite/attribute Resource. admin. (2006, July 03). Assignment 12. Retrieved September 06, 2008, from Free Online Course Materials — USU OpenCourseWare Web site: http://ocw.usu.edu/Economics/Introduction_to_Microeconomics/assignment12.htm. This work is licensed under a Creative Commons License.

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