ECO 201 Chap 16
Michael Spence proposed the signaling hypothesis. According to this hypothesis
employers view a college education as a signal that potential workers have a certain desirable qualities
The demand for labor is different from the demand for final goods and services because
The demand for labor is derived from the demand for the good or service the labor is used to produce
The Marginal product of labor is
The additional output a firm produces as a result of hiring one more worker.
A firm should hire more workers to increase its profits if
the wage rate is less than the marginal revenue product of labor
The demand curve for labor is also
the marginal revenue product of labor curve
as more output is produced the marginal product of labor declines
Due to the law of diminishing returns
For a firm operating in competitive markets, the marginal revenue product of labor equals the
Marginal product of labor multiplied by the product price
Which of the following is not held constant along a firms demand curve for labor
the wage rate
An increase in a perfectly competitive firm's demand for labor could be caused by
a increase in the amount of human capital amoung the labor force
An increase in the supply of capital which is a complement to labor, will lead to
an increase in the demand for labor
a firm chooses its profit-maximizing quantity of capital by
comparing the price of capital w the price of labor
Which of the following factors has significantly increased the supply of labor in the USsince 1950?
an increase in the labor force participation rate of women
which of the following would cause an increase in the equilibrium wage?
the demand for labor increases faster than the supply of labor
How will an increse in labor productivity affect equilibrium in the labor market?
The demand for labor will incrase and the equilibrium wage and quantity of labor will increase
Most economist believe that a small amount of the gap between the wages of white m
ECO 201 Chap 16
The markets for labor and other factors of production