C) marginal revenue product must exceed average revenue product.
D) the restaurant is maximizing profits.
22.Marginal resource cost is:
A) the increase in total resource cost associated with the production of one more unit of output.
B) the increase in total resource cost associated with the hire of one more unit of the resource.
C) total resource cost divided by the number of inputs employed.
D) the change in total revenue associated with the employment of one more unit of the resource.
23.Other things the same, we would expect the labor demand curve of a purely competitive seller to be:
A) of unitary elasticity.
B) more elastic than that of an imperfectly competitive seller.
C) less elastic than that of an imperfectly competitive seller.
D) perfectly elastic.
24.The marginal revenue product of any input is the:
A) cost of an additional unit of that input.
B) added profits resulting from the use of one more unit of that input.
C) additional output resulting from the use of one more unit of that input.
D) additional revenue resulting from the use of one more unit of that input.
25.Real wages in the United States in the long run:
A) show no discernible relationship to output per worker.
B) have increased at about the same rate as increases in output per worker.
C) have increased slower than increases in output per worker.
D) have increased faster than increases in output per worker.
26.Over the long run, real earnings per worker can increase only at about the same rate as the economy's rate of growth of:
A) total output. C) output per worker.
B) stock of capital. D) international trade.
27.Increases in the productivity of labor result partly from:
A) the law of diminishing returns. C) reductions in wage rates.
B) improvements in technology. D) increases in the quantity of labor.
28.The real wage will rise if the nominal wage:
A) falls more rapidly than the general price level.
B) increases at the same rate as labor productivity.
C) increases more rapidly than the general price level.
D) falls more rapidly than the general price level.
29.The productivity and real wages of workers in the industrially advanced economies have risen historically partly because:
A) workers have acquired less education and training over time.
B) workers have been able to use larger quantities of capital equipment.
C) over time the capital equipment used by workers has deteriorated in quality.
D) the supply of labor has increased.
30.Marginal revenue product (MRP) of labor refers to the:
A) increase in total revenue resulting from the sale of an additional unit of output.
B) amount by which a firm's total resource cost increases when it employs one more unit of labor.
C) increase in total revenue resulting from the hire of one more unit of labor.
D) price at which additional units of labor can be employed in a monopsonized labor market.
31.A firm operating in a purely competitive resource market has a resource supply curve that is:
A) perfectly inelastic. C) highly inelastic.
B) perfectly elastic. D) highly elastic.
32.A profit-maximizing firm will:
A) expand employment if marginal revenue product exceeds marginal resource cost.