1)Whichofthesefactorswouldshiftthelabordemandcurveout

(increaselabordemand)?

a)DecreaseinimmigrationintotheUnitedStates. b)IncreaseinimmigrationintotheUnitedStates

c)Priceofoutputgoodincreases(laborisusedtomakethisoutput). d)Priceofoutputgooddecreases(laborisusedtomakethisoutput).

2)Ifthemarginalrevenueproductoflaborisgreaterthanthewage rate(MRPh >w),whatshouldaprofit-maximizingfirminacompetitive labormarketdo?

a)Nothing.Thisistheprofit-maximizingpoint. b)Hirelesslabor.

c)Hiremorelabor.

d)Increasethewagerate. e)Decreasethewagerate.

3)Iftheelasticityoflabordemandwithrespecttowagesis-3 (E=3),whatistheeffectonlabordemandofa10percentincreaseinthe equilibriumwagerate.

a)Noeffect on labordemand.

b)Labordemand increasesby10percent.

c)Labordemanddecreasesby10percent.

d)Labor demand decrease by more than 10percent.

e)Labor demanddecreasesbylessthan10percent.