The bargaining power of a firm depends on the degree of its _____ in hiring workers.

1. monopsony power
2. marginal revenue
3. ability to strike
4. cash flow

A profit-maximizing cartel will make pricing and output decisions as if it is:

1. a monopoly.
2. monopolistically competitive.
3. perfectly competitive.
4. an oligopoly.

The marginal revenue product of labor is derived from _____ and the _____ the final output.

1. the productivity of the worker; supply of
2. the productivity of the worker; demand for
3. marginal revenue; supply of
4. marginal revenue; demand for

Joe's Body Shop and Bryan's Body Shop are operating in a duopoly. Joe and Bryan meet and decide to charge the same prices. Joe and Bryan are:

1. illegally colluding.
2. merging their firms.
3. increasing production.
4. selling their products at a loss

In a _____, two firms follow their dominant strategy, where they are better off cooperating but each individually gains by cheating.

1. prisoners' dilemma
2. Nash equilibrium
3. duopolists' dilemma
4. non-dominant strategy

In a competitive labor market, firms will hire workers up to the point where the marginal revenue product of labor equals the:

1. price of labor.
2. demand for labor.
3. cost of capital
4. supply of the product.

_____ is a condition in which two prisoners are jointly better off under a cooperative solution than the non-cooperative solution and yet each individually gains by cheating.

1. A Nash equilibrium
2. A dominant strategy
3. A duopolists' dilemma
4. A prisoners' dilemma

If the four largest firms in an industry control 88% of the industry, this market is:

1. perfectly competitive.
2. a monopoly.
3. an oligopoly.
4. monopolistically competitive.

In an oligopoly market structure. there are:

1. many firms selling highly substitutable products.
2. a few noninterdependent firms.
3. a few interdependent firms.
4. low or no barriers to entry

A sequential move game is an example of:

1. a cooperative solution.
2. a monopoly.
3. game theory.
4. a non-cooperative solution

Joe's Body Shop and Bryan's Body Shop are operating in a duopoly. Joe and Bryan meet and decide to charge the same prices. Joe and Bryan are:

1. merging their firms.
2. increasing production.
3. illegally colluding.
4. selling their products at a loss.

_____ is a graphical representation of a simultaneous move game that demonstrates different actions and their potential payoffs.

1. Game theory
2. A matrix game
3. A payoff matrix
4. A decision tree

The underlying theme of game theory is:

1. supply and demand.
2. mathematical models.
3. anticipation of rivals' behaviors.
4. economic decision making.

A way to maximize profits illegally would be for firms to:

1. increase revenue.
2. adopt a price leadership strategy.
3. advertise.
4. collude.

Adelaide's Bakery initially prices high and hopes that her rival, Judith's Baked Goods, follows suit. From then on, Adelaide copies the strategy played by Judith in the prior period. This is an example of the _____ strategy.

1. tit-for-tat
2. low-price guarantee
3. repeated
4. price-skimming

When two firms attempt to merge and are in different stages of production of a product:

1. It is ahorizontal merger and possibly subject to antitrust concerns.
2. It is a vertical merger and not likely subject to antitrust concerns.
3. It is ahorizontal merger and not likely subject to antitrust concerns.
4. It is a vertical merger andpossibly subject to antitrust concerns.

A dominant strategy is one that is best no matter what the other player(s) do.

1. True
2. False

In general, the quantity of output in an oligopoly market is:

1. the same as in perfect competition.
2. The answer depends on the shape of the average cost curve.
3. lower than in perfect competition.
4. higher than in perfect competition

The idea that the demand for autoworkers stems from the demand for automobiles is known as:

1. indirect demand.
2. output demand.
3. derived demand.
4. the value of the marginal product of autoworkers.

Which of the following could lead to an increase in labor supply?

1. more people retire at a younger age
2. tighter restrictions on immigration policy
3. an increase in labor force participation
4. an increase in the wage rate

Floor Lamp Inc. is a perfectly competitive firm that currently employs 100 workers. The marginal revenue product of the 90th worker is $7.00 per hour. The wage rate is $8.00 per hour. To increase profits, this firm should:

1. decrease employment until theMRPof labor equals $8.00.
2. continue hiring 100 workers because the firm earns a surplus of $1.00 on each worker hired.
3. increase employment until theMRPof labor equals $8.00.
4. increase the price of lamps so that the marginal revenue product increases to $8.00 per hour

Changes in either marginal revenue (MR) or _____ will shift the demand curve for labor.

1. marginal physical product of labor (MPPL)
2. total revenue (TR)
3. total product (TP)
4. the price of labor

_____ includes the wages paid to workers, the cost of any benefits the worker receives, and other expenses related to employing a worker.

1. Marginal revenue product
2. The wage
3. The price of labor
4. Take-home pay

Wei sells sandwiches for $10 each in a competitive product market. The marginal physical product for the third worker is eight. The marginal revenue product of the third worker is:

1. $100.
2. $60.
3. $40.
4. $80.

The demand for labor is _____ in monopolistic competitive, oligopoly, and monopoly markets.

1. upward-sloping
2. downward-sloping
3. horizontal
4. vertical

A worker's wages will increase to the point where:

1. profits equal the price of labor.
2. marginal revenue product equals costs.
3. revenue equals costs.
4. marginal revenue product equals the price of labor.

Roofers, loggers, and construction workers are more likely to _____ than office workers, teachers, and sales clerks.

1. have holidays off
2. receive more vacation time
3. receive a compensating differential
4. make lower wages

In a monopsony labor market, wages are generally _____ the wages in a competitive labor market.

1. higher than
2. lower than
3. falling faster than
4. the same as

Lawmakers have attempted to address discrimination in the labor market by passing laws such as the Equal Pay Act of 1963, the Civil Right Act of 1964, and the _____ Act of 2009.

1. Lilly Ledbetter Fair Pay
2. National Labor Relations
3. Clayton
4. Wagner

The _____ Act is the law that allows workers to form labor unions through democratic elections, allows unions to strike, and requires employers to bargain in good faith with unions.

1. Clayton
2. Sherman
3. Federal Trade Commission
4. National Labor Relations

\f(Figure: Simultaneous Move Games 2) Firm B Not Advertise Advertise Not $200 $250 Advertise $200 $100 Firm A $100 $150 Advertise $250 $150 In the figure, if Firm A does not advertise and Firm B also does not advertise, Firm B's payoff is: A $200. B $150. $250. D $100.(Figure: Simultaneous Move Games 2) Firm B Not Advertise Advertise Not $200 $250 Advertise $200 $100 Firm A $100 $150 Advertise $250 $150 In the figure, if Firm A advertises and Firm B does not advertise, Firm B's payoff is: A $250. B $100. $150. D $200.(Figure: Labor in a Competitive Market A) Price of Labor $600 550 500 450 400 350 300 250 200 150 100 50 Demand 0 2 3 5 Labor In the figure, at equilibrium, the firm would hire at a price of labor of A two workers; $400 B one worker; $350 six workers; $50 three workers; $250(Figure: MPP and MRP) Unit Price = $5 Labor Total MPPL Total MRPL Product Revenue (Q) (TR) 35 35 ? $175 75 40 $200 4J 105 30 $525 130 25 $650 5 150 20 $750 In the table, what is total revenue if 1 worker is hired? A $200 B $175 $35 D $150