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Illustrate the effect in the market for musicians when the musicians are successful in having their demands met.
New England shoe manufacturers hired workers in a competitive labor market. Show the effects of a union wage rate that is higher than the market wage rate.
However, for each additional dollar per hour, she would cut back on work by one hour per week. In the diagram, sketch both parts of Kelly's labor supply curve.
What's going on in the world of organized labor? Is the example you found consistent with the trends described in this chapter?
Do any of these individuals exhibit a backward-bending labor supply curve? Is the market supply curve for these five individuals backward bending?
When you find such a story, check back over the next few days. Did other airlines match the leader, or was the leader forced to back off its price changes?
Use a cost-and-revenue graph to illustrate and explain the short-run profits in the video rental business.
Why might a price-leadership model of oligopoly not be an effective means of collusion in an oligopoly?
(Optimal Use of More Than One Resource) Explain the rule for determining optimal resource use when a firm employs more than one resource.
Many countries are predominantly agricultural. How does the law of diminishing marginal returns affect a firm's demand for labor?
Explain why the market supply curve of a resource slopes upward. Distinguish between how market reacts to a temporary difference in prices for same resource.
Analyze what would the supply of labor curve look like over this range of wages? Why?
Explain the concept of the net utility of work. How is it useful in developing the labor supply curve?
Use the diagram to illustrate the economic rent earned by workers who would fish at wage rates below the market equilibrium by shading in the appropriate area.
How students would be willing to sacrifice more hours of summer leisure the higher the wage rate. Identify the market equilibrium wage and hours of labor.
Why did labor supply, labor demand, or both change? Was only a single labor market affected, or were the effects felt in several markets simultaneously?
Suppose the market price of output is $25 per unit. What is the maximum weekly wage at which the firm would hire that additional worker?
Draw a line to represent fixed costs. Then draw in curves to represent variable cost and total cost.
Charles Cobbler, who continues to make fine shoes, faces typical short-run cost curves. Draw a curve that would represent marginal cost of production for firm.
Pick one and see if you can determine how it might affect a firm's cost curves. Will it cause one resource to be substituted for another?
How does having a menu that is uniform around the country provide McDonald's. How is menu planning made more complex by expanding into other countries?
(Perfect Competition and Efficiency) Define productive efficiency and allocative efficiency. What conditions must be met to achieve them?
Why does the long-run industry supply curve for an increasing-cost industry slope upward? What causes the increasing costs in an increasingcost industry?
(Case Study: Auction Markets) Which of the characteristics of the perfectly competitive market structure are found in the Flower Auction Holland?
(Market Structure) Define market structure. What factors are considered in determining the market structure of a particular industry?