Question

Question 19 (1 point)

In an oligopolistic market:

Question 19 options:

	a. only a few dominant firms are present.
	b. products may be standardized or differentiated.
	c. each firm considers how rivals might react to its price policies.
	d. all of the above are true.

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Question 21 (1 point)

Some Electric Workers Unions require long periods of apprenticeship before granting full membership to new workers in order to:

Question 21 options:

	a. increase the number of qualified workers in the organization.
	b. ensure that the quality of their work is consistently high.
	c. restrict entry into the trade and thus maintain high wages.
	d. ensure that many low paid electricians will always be available in the industry.

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Question 22 (1 point)

"Marginal revenue product"(MRP) measures the:

Question 22 options:

	a. increase in a firm's revenues due to the hire/use of an extra unit of a resource(input).
	b. decline in product price which a firm must accept in order to sell the extra output of one more worker.
	c. increase in total resource cost which results from the hire of one extra unit of a resource.
	d. decrease in total revenue which results from the production of one more unit of a product.

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Question 23 (1 point)

The labor demand curve of a purely competitive firm/producer:

Question 23 options:

	a. slopes downward because the elasticity of demand is always less than unity.
	b. slopes downward because of diminishing marginal productivity of labor.
	c. is perfectly inelastic at the going wage rate.
	d. slopes downward because of diminishing marginal utility.

Answer 1

19. d. all of the above are true.

Oligopoly is a market structure characterized by the presence of a few large firms who produces homogeneous or differentiated products intensely competing against each other and recognizing interdependence in their decision-making. Under this type of market, prices are normally rigid as firms are afraid of immediate reactions of the rival firms which may start price war. The demand curve facing an oligopoly firm is indeterminate because of high degree of interdependence and uncertainty among oligopolistic firms. The firm does not know how his rival firms react to its decisions. Sales and profits of the firms are affected by the rivals' firm's actions. Example: there are only a few auto-producers in the Indian market. Maruti, Tata, Ford, Fiat are some well-known brand names.

22. a. increase in a firm's revenues due to the hire/use of an extra unit of a resource(input).

Marginal revenue is the additional revenue which firm gets from employing or producing one more unit of labor or output respectively.

23. b. slopes downward because of diminishing marginal productivity of labor.

Demand curve of labor is negatively sloped straight line which is resulted because of diminishing marginal productivity of labor.