EBK PRINCIPLES OF MICROECONOMICS
7th Edition
ISBN: 8220101472380
Author: Mankiw
Publisher: CENGAGE L
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Chapter 18, Problem 6CQQ
To determine
Theeffect of reducing stock of capital on factor marker.
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You are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain how this would change demand for labor.
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You are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain in sentence form how this would change demand for labor.
There is an increase in the price of steel. You make tractors.
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- You are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain in sentence form how this would change demand for labor. You own a sports equipment manufacturing firm. You were just informed rent at your warehouse space would double.arrow_forwardThe demand for a factor of production (productive resource) is derived from the demand for the good the factor produces True Falsearrow_forwardSuppose that the market for labor is initially in equilibrium. An increase in the price of output will cause the equilibrium wage a. and the equilibrium quantity of labor to fall. b. and the equilibrium quantity of labor to rise. c. to rise and the equilibrium quantity of labor to fall. d. to fall and the equilibrium quantity of labor to rise.arrow_forward
- wheat is the main input in the production of flour. all else equal, if the price of wheat decreases, what would we expect?arrow_forwardWhich of the following causes a rightward shift in the demand for labor in the market for cars? a. The price of motorbike (a substitute good) increases. b. The price of car increases. Car manufactures purchase and install labor augmenting car manufacturing equipment. All of the above C. d.arrow_forwardFor each of the following determine the impact on the demand or the supply of labor and the effect on the equilibrium wage and quantity of labor employed. a. An increase in the price of capital. b. A union is formed which uses collective bargaining to obtain higher wages for its members. c. The marginal productivity of workers rises. d. People desire leisure more than ever before (e.g. it is Christmas Day). e. The wages offered in other labor markets requiring similar skills are now offering substantially higher wages. f. The fringe (non-monetary) benefits offered in this market have increased substantially. g. The government has just adopted an "open-door' immigration policy?arrow_forward
- Suppose that the president proposes a new law aimed at reducing healthcare costs: All Americans are required to eat one apple daily. Which of the following statements correctly describes the effect of this apple-a-day law? Check all that apply. The marginal product of apple pickers increases. The value of the marginal product of apple pickers remains unchanged. The equilibrium price of apples increases. The wage of apple pickers remains unchanged. The demand for apples increases. The demand for apple pickers decreases.arrow_forward1. factor markets? take an example 2. changes of labor supply and labor demand? take an example 3.Optimal choice of factors in perfectly competitive factor markets? take an examplearrow_forwardYou publish a magazine for calculator collectors. To produce and distribute this magazine, you use a number of inputs: • computers labor . раper • postage • staplers What is the impact on the market, if the price of labor goes down ? Choose one: O A. The demand for the magazine shifts to the right, and the supply curve shifts to the left. The equilibrium price rises, but there is an unknown change in the equilibrium quantity. O B. The demand for the magazine does not change, and the supply curve shifts to the left. The equilibrium price rises, but the equilibrium quantity falls. O C. The demand for the magazine does not change, and the supply curve shifts to the right. The equilibrium price falls, but the equilibrium quantity rises. O D. The demand for the magazine shifts to the left, and the supply curve shifts to the right. The equilibrium price falls, but there is an unknown change in the equilibrium quantity.arrow_forward
- Which of the following can reduce the marginal revenue product of labor? Select one: a. A reduction in the demand for firms– products. b. A reduction in workers– supply of labor to firms. c. A decrease in firms– demand for inputs that substitute for labor. d. An increase in the extra output firms gain from adding another unit of labor.arrow_forwardYou are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain in sentence form how this would change the demand for labor. See the example and model your answers after how the example is written.arrow_forwardConsider this graph represents McDonald's demand for labor. Choose the 2 scenarios that would shift the demand for labor from D1 to D3. Group of answer choices McDonalds buys a machine that can do the work of 5 human employees. (Long Run) Breaking News: All McDonald's food contains traces of rat poison. People decide to eat less. The Travis Scott meal is heavily promoted on social media increasing people's desire to eat at McDonalds more often. McDonalds buys a machine that can do the work of 5 human employees. (Short Run)arrow_forward
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