Lesson 6

Question 1

____ are the factors of production, plus the element of market

Answer 1

Factor Markets

Question 2

Is the workers effort

Answer 2

Labor

Question 3

Refers to the facilities, equipment and other resources that aid in the production of goods and services.

Answer 3

Capital

Question 4

The capital as a factor of production is referred to as the ______, not actually the financial capital or the monetary requirement in starting a business.

Answer 4

Physical Capital

Question 5

Is the ground or the natural resources required in the production

Answer 5

LandLand

Question 6

Is the ability of one person to see economic opportunities

Answer 6

Entrepreneurship

Question 7

The _____ is able to put together land, labor, and capital to build these opportunities.

Answer 7

Entrepreneur

Question 8

For land, the income received is called _____, for labor _____, for capital ___, and for entrepreneur is the income from _____.

Answer 8

Rental Income, Wages, Interest, Profit

Question 9

There are also markets for the factors of production or _____ to production

Answer 9

Inputs

Question 10

This keeps the circular flow of economic activity moving

Answer 10

Factor Markets

Question 11

Is the market for the factors used in the production of a consumer product, and not the good produced itself.

Answer 11

Factor Market

Question 12

Is the market for final good or service which is usually considered to be a consumer product.

Answer 12

Product Market

Question 13

Are usually the best examples to represent factor markets while markets for capital and land also count as factor markets or markets for factors of production

Answer 13

Labor Markets

Question 14

Is a market where people offer their skills to employers in exchange for salaries and other forms of compensation.

Answer 14

Labor Market

Question 15

In Labor Market Equilibrium, it is for the fact that individuals would be ____ willing to work when wage is ____, while firms prefer to hire when the wage is ____

Answer 15

More - High
Low

Question 16

____ or ____ is simple like a demand for a good so it generally follows the law of demand.

Answer 16

Labor Demand or Demand for Labor

Question 17

This mean that employers will hire more people when wages go down.

Answer 17

Labor Demand

Question 18

As wage increases, more people will enter labor market and compete for higher paying jobs, and vice versa

Answer 18

Labor Supply or Supply of Labor

Question 19

This is when the labor demand and supply meet at a certain wage and quantity of workers, equilibrium takes place. This point of equilibrium is called?

Answer 19

Market Clearing

Question 20

When jobs are easy and safe, we assume that the wages are on the average and most people would want to have such jobs. When the job tend to become difficult and dangerous, workers would naturally require a higher wage in order to perform such kins of job. What do you call this?

Answer 20

Equilibrium Wages

Question 21

This ___ is the difference in wafes that arises to offset the nonmonetary charateristics of different jobs.

Answer 21

Compensating Differential

Question 22

A ______ leads to an efficient allocation of resources.

Answer 22

Competitive Equilibrium

Question 23

When people exhibit intelligence abobe the others, they usually get better wages due to their _______.

Answer 23

Natural Ability

Question 24

Since it is more difficult to earn a college degree, graduates are then perceived to be highly capable. This is ______

Answer 24

Signaling Theory

Question 25

This phenomenon suggests that only individuals who are highly sought after or admired by large crowd earn huge amounts of money can make them very important in the world.

Answer 25

Superstar Phenomenon

Question 26

______ is a by product of micro-level decisions of the workers and the firms.

Answer 26

Unemployment

Question 27

_____ explains that it would be beneficial for firms to pay workers above the equilibrium wage rate to encourage workers to work more effciently and make more profit firm.

Answer 27

The Efficiency-Wage Theory

Question 28

In the case of a firm paying lower wages to its employees, this would cause employees, especially those with good skills, to look for different jobs elsewhere. In effect, the firm would be left with employees with lower skill levels, turning out lesser productivity.

Answer 28

The Efficiency-Wage Theory

Question 29

High wages give employees an incentive to stay with the company which is compensating them well. This results to a __________, which then reduces the company’s need to train and hire more workers.

Answer 29

Reduced Worker Turnover

Question 30

______ argues that wages depend on the supply and demand for labor and that labor demand depends on the value of the marginal productivity of labor.

Answer 30

The Neoclassical Theory

Question 31

Chapter summary.

Answer 31

READY!

Question 32

A ____ is the market for a final good or service which is usually considered to be a consumer product.

Answer 32

Product Market

Question 33

A______ is the market for the factors used in the procustion of a consumer product, and not the good produced itself.

Answer 33

Factor Market

Question 34

A _____ is a market where people offeer their skills to employees in exchange for salaries and other forms of compensation.

Answer 34

Labor Market

Question 35

The _____ is simply a demand for a good so it generally follows the the law of demand.

Answer 35

demand for labor

Question 36

The ___ states that id the price of labor increases, then the supply of labor will also increase and vice versa.

Answer 36

Law of Supply

Question 37

______ is the difference in wages that arises to offset the nonmonetary characteristics of different jobs.

Answer 37

Compensating differential

Question 38

The ____ suggests that only individuals who are highly sought after or admired by a large crowd can earn huge amounts of money, thus making them very important in the world.

Answer 38

Superstar phenomenon

Question 39

A ____ rate in an economy signals a healthy economic ativity in a country

Answer 39

Good Employment Rate

Question 40

The _____ explains that it would be beneficial for firms to pay workers above the equilibrium wage rate to encourage them to work more efficiently

Answer 40

Efficiency Wage Theory