Questions and Answers
A change in the quantity of the product that the labor produces can:
Improvements in the productivity of labor will tend to:
If the demand for software engineers ____ slower than does supply, wages of software engineers will ____.
increases; fall
What will happen to the quantity demanded of financial capital at any given interest rate?
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If labor demand is downward sloping and labor supply is upward sloping, then when labor demand rises faster than labor supply, it is expected that real wages ____.
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A price floor that makes it illegal for an employer to pay employees less than a certain hourly rate is known as:
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A straightforward example of a __________, often used for simplicity, is the interest rate.
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The supply curve of textbooks will shift to the left in response to:
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What will happen to the supply curve for the drug if a more efficient means of processing algae to produce an anticancer drug is discovered?
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What will be the likely effect of the provincial minimum wage increase in Ontario in 2009?
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As the __________ substitute for low-skill labor becomes available, the demand curve for low-skill labor will shift to the left.
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Which of the following results in a rightward shift of the market demand curve for labor?
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In contrast to goods and services markets, _____________ are rare in labor markets, because rules that prevent people from earning income are not politically popular.
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Other things being equal, a _______ supply of workers tends to ____ real wages.
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The labor ____________ curve(s) will shift _______________ if there is an increase in productivity or an increase in the demand for the final product.
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Laws that impose an upper limit on the interest rate that lenders can charge are known as:
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Many economists believe that the trend toward greater wage inequality across the U.S. economy was primarily caused by __________.
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What is the likely economic effect on the market for steel if steel mill wage costs increase by 18 percent over a year?
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How do apple growers react to the news of medical research findings that suggest that eating apples leads to greater health benefits than were previously known?
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Whenever there is a shortage at a particular price, the quantity sold at that price will equal:
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Study Notes
Labor Demand and Wages
- A change in product quantity produced by labor can shift the labor demand curve.
- Improved labor productivity tends to increase wages.
- If the supply of software engineers increases slower than demand, their wages will fall.
- A rise in labor demand that outpaces supply is expected to increase real wages.
Labor Market Dynamics
- The demand for financial capital shifts right with increased quantity demanded at given interest rates.
- Minimum wage laws create price floors that prevent employers from paying below certain hourly rates.
- An increase in demand for a firm’s products leads to a rightward shift in the labor demand curve.
Supply Curves and Market Responses
- The supply curve for textbooks shifts left if there’s a sharp increase in wood demand for home construction.
- Efficiency improvements in drug processing shift the drug supply curve rightward, lowering drug prices.
- An increased minimum wage alongside a leftward labor demand shift during a recession may raise unemployment rates.
Technological Impact on Labor
- Availability of technology as a substitute for low-skill labor causes a leftward shift in the low-skill labor demand curve.
- Larger worker supplies tend to decrease real wages.
Economic Principles
- Labor demand curves shift right with productivity increases or heightened final product demand.
- Price ceilings are rare in labor markets due to political unpopularity of income restrictions.
- Usury laws limit maximum interest rates that lenders can charge.
Wage Inequality and Market Effects
- Wage inequality in the U.S. is primarily attributed to new technologies.
- Rising wage costs in industries like steel lead to left-shifting supply curves, increasing prices of the products.
- Apple growers respond positively to health research regarding apples by increasing the quantity supplied.
Shortages in the Market
- In cases of shortage at a certain price, the quantity sold will equal the quantity supplied at that price.
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Description
This quiz focuses on key concepts from Chapter 5 of your economics course. It covers the relationship between labor demand, productivity, and wage changes. Test your understanding of how these factors interact in the labor market.
