tailieunhanh - Câu hỏi đánh giá môn Kinh tế vĩ mô bằng tiếng Anh- Chương 14

Tham khảo tài liệu 'câu hỏi đánh giá môn kinh tế vĩ mô bằng tiếng anh- chương 14', kinh tế - quản lý, kinh tế học phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | Chapter 14 Markets for Factor Inputs CHAPTER 14 MARKETS FOR FACTOR INPUTS REVIEW QUESTIONS 1. Why is a firm s demand for labor curve more inelastic when the firm has monopoly power in the output market than when the firm is producing competitively The firm s demand curve for labor is determined by the incremental revenue from hiring an additional unit of labor known as the marginal revenue product of labor MRPl MPi MR the additional output product that the last worker produced times the additional revenue earned by selling that output. In a competitive industry the marginal revenue curve is perfectly elastic and equal to price. For a monopolist marginal revenue is downward sloping. As more labor is hired and more output is produced the monopolist will charge a lower price and marginal revenue will diminish. All else the same marginal revenue product will be smaller for the monopolist. This implies that the marginal revenue product for the monopolist is more inelastic than for the competitive firm. 2. Why might a labor supply curve be backward bending A backward-bending supply curve for labor may occur when the income effect of an increase in the wage rate dominates the substitution effect. Labor supply decisions are made by individuals choosing the most satisfying combination of work and other leisure activities. With a larger income the individual can afford to work fewer hours the income effect. As the wage rate increases the value of leisure time the opportunity cost of leisure increases thus inducing the individual to work longer hours the substitution effect. Because the two effects work in 232 Chapter 14 Markets for Factor Inputs opposite directions the shape of an individual s labor supply curve depends on the individual s preferences for income consumption and leisure. 3. How is a computer company s demand for computer programmers a derived demand A computer company s demand for inputs including programmers depends on how many computers it sells. The firm s