Question

1. A large firm is likely to make more total profits than a small firm. As for the profit rates of the two firms

1. The large firm will have the higher profit rate
2. We cannot know which has the larger profit rate without more information
3. Both firms will have the same profit rate
4. The small firm will have the larger profit rate

2. If BER, Inc paid wages a $15 per hour, and the average worker produced 5 units of output per hour, the unit labor cost would be

1. $0.33
2. $10
3. We cannot determine the answer without more information
4. $3

3. The unit labor costs is defined as:

1. The hourly wage divided by the value of capital goods owned
2. The hourly wage divided by output per hour
3. The hourly wage divided by the total number of employees
4. The hourly wage divided by the total number of units produced

4. Which of the following is included in the subordinate primary labor market?

1. Non-unionized employment by small business
2. Retail work in the private sector
3. Government employment
4. Bureaucratically organized professional work

5. The fundamental driving force at the center of the capitalist accumulation is

1. Improving the average standard of living
2. Meeting the material needs of society
3. Profit-making and investment
4. Putting natural resources to the best possible use

6. Each of the following conditions of employment can be specified in a labor contract, Except

1. Work effort
2. The wage rate
3. How disputes between workers and employer are handled
4. The hours of work

7. If a corporation made $8 billion in total profits last year, and owned buildings, machinery, and other capital goods worth $40 billion, its profit rate would be

1. 48%
2. 20%
3. 32%
4. 500%

8. Commercial profits

1. Result from a production process
2. Represent the monetary value of the surplus product under communal equality
3. Are made by selling something for more than it cost to purchase
4. Are the same thing as capitalist profits

9. Total profits often include all of the following except

1. Wages to workers
2. Dividends to stockholders
3. Rents to landowners
4. Interest to bankers

10. Which of the following is Not a characteristic of the economic system of independent production?

1. Producers surrender their surplus product to another class
2. Producers consume some of their own output
3. Producers use their own labor , including family labor
4. Capital goods are owned by the producers

Answer 1

1> B

We do not know whether the production is increasing return to scale or decreasing, thus without further information, we can not tell which firm will have a higher profit rate.

2> D

Each labor produces 5 unit in an hour and they are paid $15, so each unit will have a labor cost of $15/5 =$3

3> B

Unit Labor Cost is how much a business pays its workers to produce one unit of output. Thus it is hourly wage by the hourly output produced by a labor

4> B

subordinate primary labor market consists of job market which does not require formal education but they are better than secondary market as they have some bargaining power and they have somewhat job-security, a private retail job would be an example of that.