Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Chapter 18, Problem 3.6P
To determine
Identify the concept of executive compensation.
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5. In Chapter 9 of your text, complete Exercise #3 found on page 321.
Suppose that you observe that the wages for accountants in your town have gone up and that the
number of accountants employed has also gone up. Which one of the following conditions could
explain this? Illustrate your answer with a graph and explain in a brief paragraph.
a) Businesses are failing, reducing the need for accountants.
b) Many accountants are leaving the field in order to train to become financial analysts
instead.
c) A rash of business scandals has increased the demand for auditing services performed by
accountants.
d) The local university has just graduated an unusually large group of accountants.
2a
2b
Q33
In order to maximize profits, a firm needs to determine the quantity of each factor that it will employ, which is dictated by price as well as productivity of the factor. Assume farmer in the Ottawa area named Justin Trudeau has fixed amounts of land and capital and finds that total product is 24 for the first worker hired, 32 when two workers are hired, 37 when three are hired, and 40 when four are hired. Justin Trudeau product sells for $3 per unit, and the wage rate is $13 per worker. The marginal product of the second worker is
Multiple Choice
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14.
8
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Chapter 18 Solutions
Principles of Economics (12th Edition)
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- Q35 In order to maximize profits, a firm needs to determine the quantity of each factor that it will employ, which is dictated by price as well as productivity of the factor. Assume farmer in the Ottawa area named Justin Trudeau has fixed amounts of land and capital finds that total product is 24 for the first worker hired, 32 when two workers are hired, 37 when three are hired, and 40 when four are hired. Justin Trudeau's product sells for $3 per unit, and the wage rate is $13 per worker. What is Justin Trudeau's profit-maximizing output? Multiple Choice 16. 40 37 20 32arrow_forwardI need help with the last 3 parts (not part A).arrow_forwardRecall the Application about the level of real wages for laborers in England from 1350 to 1550 to answer the following question(s). In 1348, the bubonic plague, also known as the Black Death, arrived in England from Asia and caused a long decline in total population through the 1450s. According to this Application, economist Thomas Malthus observed that social maladies such as the Black Death would temporarily living standards until living standards led to increased population growth. ..... A. lower; higher B. raise; higher C. raise; lower D. lower; lowerarrow_forward
- Discuss the relationship between job rotation and strategic managementarrow_forwardPlease answerarrow_forwardAccording to a 2016 article in the Wall Street Journal, “After years of relative equilibrium, the job market for nurses is heating up in many markets, driving up wages and sign-on bonuses for the nation’s fifth-largest occupation.” Many nurses who previously delayed their retirement due to the 2008 recession had begun to retire, resulting in a retirement wave that caused nurses to exit the workforce in greater numbers than new nurses were entering. At the same time, demand for nurses had increased due to the additional health care coverage associated with job growth over the previous decade since the recession and the Affordable Care Act. Draw a demand and supply graph illustrating these developments in the market for nurses. Based on your diagram, forecast what will happen to the equilibrium wage for nurses as a result of the shift(s)? Is this consistent with what we actually observed? Briefly discuss whether this problem provides enough information to determine whether the…arrow_forward
- Discuss the contributions of economics to employee and management motivation and pay.arrow_forwardAssume that the accounting and actuarial industries employ people with similar skills. Suppose a decrease in the demand for actuaries leads to a fall in their wages, while the demand for accountants remains the same. The following graph shows the labor market for accountants in the United States. Show the effect of the fall in demand for actuaries on the U.S. labor market for accountants by shifting the labor demand curve, the labor supply curve, or both. WAGE LABOR Supply Demand Demand Supply (?)arrow_forwardThe Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires, total output, marginal product, and marginal revenue product of labor, with all other inputs being held constant. Assume that the selling price is $10 per box of paper. Labor Input Total Output Marginal Product Marginal Revenue Product Price = $10 (Workers per day) (Boxes of paper per day) (Boxes of paper per day) (Dollars) 0 0 14 2 26 36 44 5 50 AAAAAA 14 $140 12 $120 10 $100 8 $80 64 $60 $40 6 54 If the wage rate is $50.00 per day, Zippy will hire workers. Suppose that the workers in this industry have unionized and have collectively bargained for a wage of $70.00. As a result of this collective bargaining agreement, Zippy will the number of workers it hires to hire workers.arrow_forward
- For Questions 13 and 14, Consider that Kim is a Nurse at a hospital in Atlanta and in 2010 she made an annual salary of $30,000. She has gotten several performance raises and one promotion over the years and in 2019 she earned $46,000 for the year. The Price Index representing her buying power in 2010 was 100 and in 2019 it is 164. It is now 2020 and Kim decided to keep working at that hospital and has worked another year and gotten a raise and another promotion and now her salary is $54,000 per year and the 2020 price index is now 171. NOW, what is the approximate value of her buying power now expressed in 2010 dollars? Question 14 options: $32,927 $26,900 $29,466 $31,579arrow_forward1. Computing labor productivity and its relationship to the demand for labor Sizzler's produces charcoal grills in a small manufacturing facility and sells the grills in a competitive market. The following table presents the company's production function: Labor (Number of workers) 0 OUTPUT (Grills) 400 360 Use the blue points (circle symbol) to plot the production function for Sizzler's on the following graph. 240 200 160 120 80 40 0 1 0 2 3 4 5 Output (Grills) 0 95 185 260 320 355 1 3 LABOR (Number of workers) Production Functionarrow_forwardHow does the theory of the firm provide an integrated framework for the analysis of managerial decision making across the functional areas of business?arrow_forward
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