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1) Which of the following is a valid explanation for rising wages? A) reductions

ID: 1210446 • Letter: 1

Question

1) Which of the following is a valid explanation for rising wages?

A) reductions in the capital available to workers

B) a reduction in the demand for goods produced by labor

C) an increase in the supply of labor

D) increases in labor productivity

2 Use the following table, which shows a firm's production, output price, and various quantities of labor (workers) employed, to answer the next question.

Workers

Total Output per Day

Price of Good

2

10

$ 10

3

15

   10

4

19

   10

5

22

   10

6

24

   10

7

25

   10

What is the marginal revenue product of the fifth worker?

A) $40

B) $20

C) $30

D) $10

3) Which of the following does not contribute to higher wages?

A) reductions in demand for the good being produced

B) technological improvements

C) greater educational attainment by the labor force

D) higher prices for the good being produced

Workers

Total Output per Day

Price of Good

2

10

$ 10

3

15

   10

4

19

   10

5

22

   10

6

24

   10

7

25

   10

Explanation / Answer

D) increases in labor productivity as they become more efficent they get high pay