If the consumer's non-labor income increases while wages remain unchanged, what will happen to the budget line? A) The budget line shifts inward without a change in slope. B) The budget line rotates inward from the intercept on the horizontal axis. C) The budget line rotates outward from the intercept on the vertical axis. D) The budget line shifts outward without a change in slope. An optimum labor-leisure that occurs as a corner solution A) can be an equilibrium in the aggregate economy. B) includes the consumption of only one good. C) cannot exhaust the budget constraint. D) includes the exact same amounts of each good. ) If a firm is a price taker in both the labor market and the output market, it will A) hire labor until the marginal product of labor equals the output price. B) hire labor until the marginal product of labor equals zero. C) earn zero economic profit in the short run. D) hire labor until the marginal product of labor equals the wage rate.

If the consumer's non-labor income increases while wages remain unchanged, what will happen to the budget line? A) The budget line shifts inward without a change in slope. B) The budget line rotates inward from the intercept on the horizontal axis. C) The budget line rotates outward from the intercept on the vertical axis. D) The budget line shifts outward without a change in slope. An optimum labor-leisure that occurs as a corner solution A) can be an equilibrium in the aggregate economy. B) includes the consumption of only one good. C) cannot exhaust the budget constraint. D) includes the exact same amounts of each good. ) If a firm is a price taker in both the labor market and the output market, it will A) hire labor until the marginal product of labor equals the output price. B) hire labor until the marginal product of labor equals zero. C) earn zero economic profit in the short run. D) hire labor until the marginal product of labor equals the wage rate.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter16: Labor Markets

Section: Chapter Questions

Problem 16.11P

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