« previous next »

Author Question: Suppose the marginal product of labor equals 1/L. If the wage is 1 per unit of labor, what is the ... (Read 71 times)

geodog55

  • Hero Member
  • *****
  • Posts: 530
on: Jul 1, 2018
Suppose the marginal product of labor equals 1/L. If the wage is 1 per unit of labor, what is the short-run effect on the firm's labor demand if the price of output were to double?
 
  A) The firm will demand half as much labor.
  B) The firm will demand twice as much labor.
  C) The firm will demand the same quantity of labor.
  D) There is not enough information to determine.

Question 2

Why would a usury law result in banks making less credit available to low-income households?
 
  What will be an ideal response?
Microeconomics ¦ Perloff ¦ 8th Edition
Buy Test-Bank


Tabitha_2016

  • Sr. Member
  • ****
  • Posts: 344
Reply #1 on: Jul 1, 2018
Answer to Question 1

B

Answer to Question 2

Without restrictions, banks would charge a higher rate to riskier borrowers. Lower-income households pose a greater risk of repayment than do higher-income households. With a usury law, a ceiling on interest rates is imposed on banks. Banks grant loans to the least risky applicants. As a result, less credit is made available to the most risky applicants, who tend to be lower-income households.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Aspirin is the most widely used drug in the world. It has even been recognized as such by the Guinness Book of World Records.

Did you know?

Every flu season is different, and even healthy people can get extremely sick from the flu, as well as spread it to others. The flu season can begin as early as October and last as late as May. Every person over six months of age should get an annual flu vaccine. The vaccine cannot cause you to get influenza, but in some seasons, may not be completely able to prevent you from acquiring influenza due to changes in causative viruses. The viruses in the flu shot are killed—there is no way they can give you the flu. Minor side effects include soreness, redness, or swelling where the shot was given. It is possible to develop a slight fever, and body aches, but these are simply signs that the body is responding to the vaccine and making itself ready to fight off the influenza virus should you come in contact with it.

Did you know?

Cyanide works by making the human body unable to use oxygen.

Did you know?

The first oral chemotherapy drug for colon cancer was approved by FDA in 2001.

Did you know?

Long-term mental and physical effects from substance abuse include: paranoia, psychosis, immune deficiencies, and organ damage.

Schematic of Rectification Unit Schematic of Rectification Unit
Aquamatic pad and heating unit provide dry heat treatment to a patient’s arm. Aquamatic pad and heating unit provide dry heat treatment to a patient’s arm.
Lattice Parameter Relationships and Figures Showing Unit Cell Geometries for the Seven Crystal Syste Lattice Parameter Relationships and Figures Showing Unit Cell Geometries for the Seven Crystal Syste
Biosynthesis of the repeating oligosaccharide unit of the O antigen of Salmonella typhimurium Biosynthesis of the repeating oligosaccharide unit of the O antigen of Salmonella typhimurium
Energy Balance Is Achieved When Energy (Calories) In Equals Energy (Calories) Out Energy Balance Is Achieved When Energy (Calories) In Equals Energy (Calories) Out
The Stages of Labor and Birth in a Vaginal Delivery The Stages of Labor and Birth in a Vaginal Delivery
Video: Primate Evolutionary Tree Animation

For a complete list of videos, visit our video library