Question

1. In positive economic models of the labor market, it is assumed that

   		workers maximize utility (happiness).
   		firms maximize profits.
   		resources are scarce.
   		all of these are true.

2 points   

QUESTION 13

1. Because of the principle of __________, marginal product of labor decreases as labor increases.

   		economies of scale.
   		diseconomies of scale.
   		diminishing returns.
   		constant returns to scale.

2 points   

QUESTION 14

1. The unemployment rate is computed as

   		the number of employed divided labor force.
   		the number of unemployed divided the number of employed.
   		the number of unemployed divided labor force.
   		the sum of the numbers of unemployed and employed divided labor force.

2 points   

QUESTION 15

1. Suppose the labor demand equation and labor supply equation: L_S = 100 + W and L_D =400 -2*W where L_S = quantity supplied of labor, L_D = quantity demanded for labor and W = wage. The equilibrium employment is _________ workers.

   		50
   		100
   		200
   		300

2 points   

QUESTION 16

1. Suppose a firm is operating in both a perfectly competitive product market and perfectly labor market. The firm’s short run production is Q = L²; where Q is output and L is labor, expressed in millions. Marginal product of labor (MP_L) = 2L and wage is 10. The price of the product is $ 2. Based on information above, the marginal revenue (MR) is

   		$0.2
   		$10
   		$5
   		$2

2 points   

QUESTION 17

1. Suppose the marginal product of labor (MP_L) = 100 – L, price of labor (wage) = $ 4 and the product price (P) = $ 2. In the short run, the optimal level of labor is

   		96
   		98
   		99
   		0

2 points   

QUESTION 18

1. The labor force consists of

   		All individuals aged 16 or older who are employed or unemployed.
   		All individuals aged 16 or older who are employed.
   		All individuals aged 16 or older who are unemployed.
   		the discouraged

2 points   

QUESTION 19

1. Suppose labor and capital are substitute and MRTS_L,K = 1.5

   		1 unit of capital can replace of 1.5 units of labor.
   		1 unit of capital can replace of 1 unit of labor.
   		1.5 unit of capital can replace of 1.5 units of labor.
   		1 unit of labor can replace of 1.5 units of capital.

2 points   

QUESTION 20

1. Suppose the labor demand equation and labor supply equation: L_S = 100 + W and L_D =400 -2*W where L_S = quantity supplied of labor, L_D = quantity demanded for labor and W = wage. The market clearing wage is ________ dollars.

   		50
   		100
   		200
   		300

2 points   

QUESTION 21

1. Consider the following production function: Q = KL where Q = output, L = labor and K = capital. The marginal product of labor is given by MP_L = K while the marginal product of capital is given by MP_K = L.   If L = 10 and K= 5, then total output is

   		2
   		5
   		10
   		50

2 points   

QUESTION 22

1. Consider the following production function: Q = KL where Q = output, L = labor and K = capital. The marginal product of labor is given by MP_L = K while the marginal product of capital is given by MP_K = L.   If L = 10 and K= 5 the marginal rate of technical substitution between labor and capital is

   		2
   		5
   		10
   		1/2

2 points   

QUESTION 23

1. The marginal product for labor is given (MP) = 3 – 0.02*L; price of the product is $100 and wage = 200. Based on information above, the optimal level of employment is in the short run is

   		200
   		100
   		50
   		25

2 points   

QUESTION 24

1. 1-      Consider the following production function, Q = L² + 20K. Marginal product of labor (MP_L) = 2L and wage is $5. Marginal product of capital (MP_K) = 20 and price of capital is $10. Then the MRTS at (L = 10 and K = 5), is equal to

   		4
   		2
   		1
   		1/2

2 points   

QUESTION 25

1. 1-      Consider the following production function, Q = L² + 20K. Marginal product of labor (MP_L) = 2L and wage is $5. Marginal product of capital (MP_K) = 20 and price of capital is $10. Then the relative price ratio is

   		4
   		2
   		1
   		1/2

Answer 1

Question - 12 8 - correct anders dizel maximize propita Question 13: Correct answers diminishing returns. Question 148 n an correct answer the number of employed divided the number of employed. o tuplayed. De Question 15:- Corect awwel 100. 1 Equalbrium employment > LD = LS 9.2 400 - 260 = 100 tv 400-100= wtoo 300 = 3W w = 300= loo Question 16o- Содоста In per ect 2. , ол - Market :- MR = AR = Price of product

I. Question 17:- correct answer - 98 In perfect competition : optimal laber is calculated by : - MRPL = MRX MPL 4 = 21100-L) 4 = 100-2 MRPL = 4 4 MR = 2 R = 100 - Question 18: correct answer - All individuals and aged 16 or older who are employed m wemployede Question 198- correct answers I unit of capital can replace 105 uwts of labor. Question 2018- correct answer 100 dollars. LD = LS 1oot w = 400-20 and the other There are a great things only small things with great love

W + 20 = 400-100 3 w = 300 or 300 Question alo- correct answer > 50 Q = KL = 5 x 10 K= 5 =10 = 50 Question 228- correct answer is » MRTSL = change in Change in labout capital

Question 248- correct answer -> 2 MRTS = L K => 10 - 2 5 -