Test Questions without Answers
Chapter 16. Market Theory II.
Factor Markets. Income Distribution. Present Value. Wage Theory
Chapter 16– Question 1
Which of the following is an investment in human capital
- employee purchases of company stock
- social-security contributions paid by employers for their employees
- employee payments into an old-age pension scheme
- an internship in a hospital for a student studying medicine
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Chapter 16– Question 2
The wage rate increases from $8 to $10. As a result, a worker increases his labour hours from 4 to 6. What is the worker's supply elasticity?
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Chapter 16–Question 3
The demand curve for labour is downward sloping because
- less labour is available as the wage rate falls
- the performance of labour declines if there is full employment
- the marginal product of labour declines as more labour is hired
- the firm must lower price to sell more units of output
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Chapter 16–Question 4
Please define present value.
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Chapter 16–Question 5
Write down the formula to calculate present value of capital.
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Chapter 16– Question 6
If the rent received for a building is $10,000 per year and interest foregone is 5 percent, what is the present value of the building?
- $2,000
- $200,000
- $50,000
- none of the above
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Chapter 16– Question 7
Is present value low or high when interest and the number of years are high?
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