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Current Location AP Microeconomics Sem / Sec FAMicES Assignments . Module Four Exam
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Instructions Name . Module Four Exam Instructions Timed Test This Test has a hour
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Elapsed Time hours, minutes, se conds undefined undefined Question Question text The
price of borrowed money is called points Answer Question answers rent. interest rate.
inflation rate or CPI. wages. profit. points Question Question text The productivity of labor in
a firm has decreased due to the recent retireme nt of many of the firms most skilled workers.
Assuming that the firm is a profi t maximizer in a perfectly competitive situation, the firm will I.
Increase the average wage. II. Decrease the average wage. III. Reduce the number of
workerhours it hires. IV. Hire additional labor. V. Increase the number of workerhours it hires.
points Answer Question answers Statement I only. Statement IV only. Statements I and V
only. Statements II and III only. Statement V only. points Question Question text
The flow of money to the firms that passes through the product market is ref erred to as in
Module Four. points Answer Question answers price tags wages product payments receipts
factor payments points Question Question text Lupita grows cantaloupes in central Florida
and is in a perfectly competitiv e market. The marginal physical product of labor is units while
the price per unit is . What is the marginal revenue product of labor of Lupitas farm points
Answer Question answers points Question Question text The local hospital is a monopsonist
employer who pays a wage of per wee k to nurses. The government imposes a minimum
wage of per week. How is the firm affected points Answer Question answers It reduces its
output. It is not affected. It increases the number of people hired. It decreases the number of
people hired. It stops hiring people. points Question Question text The firms demand curve
for labor is the same as points Answer Question answers its average variable cost curve. its
marginal revenue product curve. its average fixed cost curve. its average total cost curve. its
total output curve. points Question
Question text ElectroHeat, Inc. is in a perfectly competitive market and makes electric he
aters. The price of a heater is . The wage paid to a worker is . The firm should hire workers to
the point where the marginal physical product of the las t worker hired is points Answer
Question answers . units. , units. . . points Question Question text An increase in the
minimum wage normally attempts to help which group or gro ups points Answer Question
answers All workers in highly competitive markets are helped. No worker groups are ever
helped by the minimum wage. Unskilled and teenage workers are most generally helped.
Highly skilled workers and retired persons are helped. All workers are helped. points
Question Question text In the Circular Flow Model, the resources are ultimately owned by the
poi nts Answer Question answers savers and buyers. investors and suppliers. households.
government and its agencies. firms. points Question Question text An analysis arginal
product lar of capital. Answer Question of resource costs and use by Mannies Masonry
reveals that the m per dollar of labor is greater than the marginal product per dol What
should Mannie do points answers Reduce the number of workers employed Reduce the
amount of capital employed Increase his use of capital Hire additional labor Increase the
wage rate he pays his employees
points Question Question text One persons spending becomes another persons income.
This statement is the basis for points Answer Question answers the Quantity Theory of
Money. all economics. profit maximization rule for perfectly competitive firms. the Marginal
Productivity Theory of Resource Allocation. the Circular Flow Model. points Question
Question text Apple Computer increases its number of workers without increasing its amount
of capital. As a result, points Answer Question answers the output increases at an increasing
rate. the output does not increase. the cost of capital increases. the output increases at a
decreasing rate. the cost of labor decreases. points Question Question text Figure Price of
labor per worker Price of machine per machine Number of workers employed Marginal
physical product of workers MRP of w orkers Number of machines employed Marginal
physical product of machine MRP of machines . . . . . . . . . . . . . . Given the data found in
Figure and assuming that both resources are vari able and are employed in perfectly
competitive markets, what is the profit maxim izing combination of resources and output for
this firm points Answer Question answers Employ seven workers, seven machines, and
produce units Employ worker and capital until each has maximized output Employ five
workers, five machines and produce units Employ five workers, six machines, and produce
ten units Employ five workers, six machines, and produce units points
Question Question text Resources have two factors that impact their demand curve. These
two factors are points Answer Question answers the price of the product made by the
resource and the productivi ty of the resource. the price of the resource and the elasticity of
supply of the re source. the price of the resource and the price of substitute resources. the
supply of and the demand for the resource. the amount of the resource required to meet
production needs and the cost of acquiring the resource. points Question Question text In a
market, there are buyers and sellers of resources. Resources are poi nts Answer Question
answers sold by sold by sold by sold by sold by points Question Question text The wages of
workers at Franks Framing Shop are higher than their marginal revenue product. What
should Frank do points Answer Question answers Reduce the number of workerhours he
employs. Increase the wages of workers. Reduce the output. Increase the number of
workerhours he employs. Reduce the price of the output. points Question Question text
Under conditions of imperfect competition, the MRP for the twelth worker is calculated by
points Answer Question answers using either A or B, since they will both return the same
value for MRP. subtracting total cost from total revenue with twelve workers. summing the
MRPs from workers one through eleven. the government and bought by firms. households
and bought by firms. firms and bought by households. firms and bought by the government.
the government and bought by households.
subtracting the total revenue with eleven workers from the total revenue with twelve workers.
multiplying the marginal physical product of the twelth worker b y the product price. points
Question Question text Bennies Radiator Shop has installed a new machine that increases
production by units. Each unit sells for . What is the marginal revenue product of the new
machine points Answer Question answers , units Insufficient data points Question Question
text A local hospital hires operating room nurses in a monopsonistic labor market . The
amount paid to these nurses points Answer Question answers is double the value of their
marginal product. is equal to the value of their marginal product. is fixed by the government.
is less than the value of their marginal product. is more than the value of their marginal
product. points Question Question text A recent survey features some negative reports about
a popular sunscreen lot ion. As a result of the survey, the demand for the lotion declines. The
wages of the workers in this firm points Answer Question answers will be reduced. will fall
and then increase. are not affected. will become fixed. will be increased. points Question
Question text Which of the following correctly matches resources and their payments in the
Circular Flow Model. I. Labor wages, Land interest
II. Entrepreneurship profits, Labor wages III. Capital rent, Land profits IV. Investment capital
gains, Government taxes V. Labor wages, Land rent points Answer Question answers
Statements II and III are the only correct statements. Only statement IV is correct.
Statements III and IV are the only correct statements. Only statement I is correct. Statements
II and V are the only correct statements. points Question Question text If capital and labor
are substitutes for each other and the price of capital falls, what will happen points Answer
Question answers The demand for capital will increase. The demand for capital will
decrease. The supply of labor will increase. The demand for labor will increase. The demand
for labor will decrease. points Question Question text The Marginal Productivity Theory of
Resource Demand tells us that points Answer Question answers the firms profits are
maximized when the difference between MRP and MCR is greatest. the firms profits are
greatest when marginal revenue product marginal resource cost. firms should not hire
marginal low quality workers. the firms profits are maximized when marginal physical product
marginal revenue product. marginal revenue and MRP are the same thing and that marginal
co st and MRC are the same concept. points Question Question text Figure Price of labor per
worker Price of machine per machine Number of workers employed Marginal physical
product of workers MRP of w orkers Number of machines employed Marginal physical
product of machine MRP of machines . . . . . . . . . .
. . . . Given the data found in Figure and assuming that both resources are vari able and are
employed in perfectly competitive markets, what is the least cost c ombination of resources
that would produce at least units points Answer Question answers Four machines Three
machines and one worker Insufficient data Five machines and five workers One machine and
seven workers points Question Question text The demand for a resource is known as a
derived demand, as it depends on points Answer Question answers the price of the
resource. the demand for the product it produces. the demand for other uses for this
resource. the supply of the resource. the quality of the resource. points Question Question
text Firm X is in a monopsonistic market and bears a marginal revenue cost of per hour for
each worker. For the firm to maximize its profit, what should the marginal revenue product of
labor be points Answer Question answers Any amount above Insufficient information Any
amount below points Question Question text Simpsons Buffalo Wings is in a perfectly
competitive market when the govern ment imposes a minimum wage, above the equilibrium
wage. As a result, points Answer Question answers the price of unit output decreases. the
quantity of labor supplied increases. the price of unit output increases. the output reduces.
the quantity of labor demanded increases. points
Question Question text Mannies Masonry wants to minimize his cost of production. He
should select a combination of labor and capital for which the marginal product per dollar of
labor is points Answer Question answers more than the marginal product per dollar of
capital. equal to one. equal to the wage. equal to the marginal product per dollar of capital.
equal to the cost of capital. points Question Question text Charge Central hires Ms. Jackson
as a sales executive for selling credit car ds. She sets a goal of selling cards by the end of
the month. She actually m anaged to raise the total sales of the firm from , to , cards that
month . What is Ms. Jacksons marginal physical product for the month points Answer
Question answers cards cards , cards , cards , cards points Question Question text Harold
rents out forty acres of bottom land to a vegetable farmer. In the Ci rcular Flow Model, where
would Harold reside and where would his rental transact ions occur points Answer Question
answers Harold resides in the household and the transaction occurs in th e resource market.
Harold resides in the firm and the transaction occurs in the res ource market. None of the
above. Harold resides in the household and the transaction occurs in th e product market.
Harold resides in the firm and the transaction occurs in the pro duct market. points Save and
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