ECON 2101 XI (69 questions
and answers)
Activities are divided into two categories: ____ and _______ - answer work;
leisure
leisure - answer all activities that do not involve paid work
supply of labor - answer the amount of time an individual is willing to work at
various wage rates
substitution effect - answer higher wages mean that the value of work has
increased, and the opportunity costs of leisure are higher; hence, work is
substituted in place of leisure
the substitution effect for labor supply is always ________; it leads to more
_____ __ ____ when the ____ ____ _________ - answer positive; hours of work;
wage rate increases
income effect - answer higher wages mean that you can maintain the same
standard of living by working fewer hours. The impact on labor supply is
generally negative
the income effects counteracts the ___________ ______ - answer substitution
effect
the substitution effect encourages individuals to work ____ as wages _______.
- answer more; rise
an individual labor supply curve is ________-________ - answer backward
bending
, When the labor supply curve is positively sloped, the substitution effect is
_______ than the income effect - answer stronger
When the labor supply curve is positively sloped, income is more important
than _______ at the given wage levels - answer leisure: higher wages means
more hours worked
When the labor supply curve is negatively sloped, the substitution effect is
_______ than the income effect - answer weaker
When the labor supply curve is negatively sloped, income is (less/more)
important than leisure at the given wage levels - answer less: higher wages
means less hours worked
Individual labor supply curves are backward-bending. Market labor supply
curves are generally __? - answer positively sloped (linearly; a function,
constant slope)
The constant slope of market labor supply curves comes from: _______ prices
means ______ quantities supplied. - answer higher; higher
Why would a market labor supply curve SHIFT? (not a point on the curve
shift, but the entire solution curve) - answer -demographic changes
-non-wage aspects of jobs
-wages paid in other occupations
-non-wage income
demographic changes - answer -changes in population
-immigration patterns
-labor force participation rates (percentage of individuals in a group who
enter the labor force)
and answers)
Activities are divided into two categories: ____ and _______ - answer work;
leisure
leisure - answer all activities that do not involve paid work
supply of labor - answer the amount of time an individual is willing to work at
various wage rates
substitution effect - answer higher wages mean that the value of work has
increased, and the opportunity costs of leisure are higher; hence, work is
substituted in place of leisure
the substitution effect for labor supply is always ________; it leads to more
_____ __ ____ when the ____ ____ _________ - answer positive; hours of work;
wage rate increases
income effect - answer higher wages mean that you can maintain the same
standard of living by working fewer hours. The impact on labor supply is
generally negative
the income effects counteracts the ___________ ______ - answer substitution
effect
the substitution effect encourages individuals to work ____ as wages _______.
- answer more; rise
an individual labor supply curve is ________-________ - answer backward
bending
, When the labor supply curve is positively sloped, the substitution effect is
_______ than the income effect - answer stronger
When the labor supply curve is positively sloped, income is more important
than _______ at the given wage levels - answer leisure: higher wages means
more hours worked
When the labor supply curve is negatively sloped, the substitution effect is
_______ than the income effect - answer weaker
When the labor supply curve is negatively sloped, income is (less/more)
important than leisure at the given wage levels - answer less: higher wages
means less hours worked
Individual labor supply curves are backward-bending. Market labor supply
curves are generally __? - answer positively sloped (linearly; a function,
constant slope)
The constant slope of market labor supply curves comes from: _______ prices
means ______ quantities supplied. - answer higher; higher
Why would a market labor supply curve SHIFT? (not a point on the curve
shift, but the entire solution curve) - answer -demographic changes
-non-wage aspects of jobs
-wages paid in other occupations
-non-wage income
demographic changes - answer -changes in population
-immigration patterns
-labor force participation rates (percentage of individuals in a group who
enter the labor force)
