Factor Markets
In the circular flow model, which of the following transactions occurs in factor markets?
The demand for labor is considered a derived demand. This is because the demand for labor depends on:
Which of the following best describes Marginal Revenue Product (MRP)?
A firm is considering hiring an additional worker. The marginal revenue product (MRP) of the worker is 15. According to the MRP = MRC rule, what should the firm do?
A company is deciding whether to hire an additional employee. The MRP of the potential employee is decreasing with each additional hire, while the MRC is constant. How should the firm decide how many employees to hire?
Which of the following factors would directly cause an increase in the demand for labor by construction companies?
Suppose the introduction of new automated machinery significantly increases the productivity of workers in a manufacturing plant, what will happen to the labor demand curve?
How are we doing?
Give us your feedback and let us know how we can improve
A new technology increases the productivity of capital, while simultaneously the demand for the final product decreases. What is the likely effect on the demand for labor?
Which of the following would cause a decrease in the supply of labor in a particular industry?
A state government introduces stricter licensing requirements for electricians. What is the most likely effect on the supply of electricians?