Practice.docx - AP Economics Factor Market Review AP...

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AP Economics Factor Market Review
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AP Economics Factor Market Review 1. Use the resource demand data shown on the left and the resource supply data on the right in answering the following question: Refer to the given data. What will be the profit-maximizing selling price of the product? A. $1.40. B. $1.60. C. $1.80. D. $2.00. 2. Use the resource demand data shown on the left and the resource supply data on the right in answering the following question: Refer to the given data. We can conclude that: A . both the product and resource markets are imperfectly competitive. B . the resource market is imperfectly competitive, but the product market is purely competitive. C . both the resource and product markets are purely competitive. D . the resource market is purely competitive, but the product market is imperfectly competitive. 3. A firm can hire six workers at a wage rate of $8 per hour but must pay $9 per hour to all of its employees to attract a seventh worker. The marginal wage cost of the seventh worker is: A . $ 9 . B . $ 1 0. C . $ 1 5. D . $ 2 1.
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AP Economics Factor Market Review 4. Refer to the diagram, assume no union or relevant minimum wage, the firm represented will hire: A. Q 2 workers and pay a W 4 wage rate. B. Q 2 workers and pay a W 1 wage rate. C. Q 3 workers and pay a W 2 wage rate. D. Q 4 workers and pay a W 1 wage rate. 5. Refer to the diagram. Assume that an inclusive union is formed to bargain with the monopsonistic employer of the question. To what level can this union increase the wage rate without causing the number of jobs to decline below that which the monopsonist would otherwise have provided?
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