mac09L2

  • 1

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    When labor increases with no change in labor productivity, _________________.

    a movement downward along the production function occurs
    the PPF shifts inward
    a movement upward along the production function occurs
    the PPF shifts outward

  • 2

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    _______ is the knowledge and skill that people have obtained from education and on-the-job training.

    Capital
    Technology
    Human capital
    Learning-by-doing

  • 3

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    When the real wage rate rises, ___________________.

    the quantity of labor demanded increases
    a surplus of labor decreases
    the quantity of labor demanded decreases
    a shortage of labor increases

  • 4

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    As the quantity of labor employed increases, the _________________.

    marginal product of labor does not change
    money wage rate rises
    marginal product of labor decreases
    real wage rate rises

  • 5

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    When a rise in the real wage rate occurs, most households will have an _________________.

    income effect that is stronger than the opportunity cost effect
    increase in their labor supply
    opportunity cost effect that is stronger than the income effect
    opportunity cost effect that is equal to the income effect

  • 6

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    When the population increases with no change in labor productivity, potential GDP _______ and potential GDP per hour work _______.

    increases; increases
    decreases; increases
    increases; decreases
    decreases; decreases

  • 7

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    The time spent on job search falls when _______________________.

    the opportunity cost of not working decreases
    the efficiency wage is lowered
    unemployment compensation decreases
    unemployment compensation increases

  • 8

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    Job rationing creates _________________________.

    a decrease in the natural rate of unemployment
    a wage rate below the equilibrium wage rate
    a surplus of labor
    a surplus of jobs

  • 9

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    The efficiency wage _____________________.

    does not motivate employees
    results in a high labor turnover
    maximizes the firm's profit
    is equal to the minimum wage

  • 10

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    A minimum wage ______________________.

    set below the equilibrium wage is effective
    must be set below $5.15 an hour to be effective
    set above the equilibrium wage is effective
    discourages job rationing

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