Which of the following statements is TRUE about the market demand curve for labor?
A) The market demand curve is the sum of the individual firm's demand curve.
B) The market demand curve will be perfectly inelastic since firms need labor.
C) The market demand curve shows the quantities of labor demanded by all firms in the industry at various marginal products.
D) The market demand curve depends upon labor productivity, the wage rate and the price of the final product.
D
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Price elasticity of demand measures the:
A. slope of the demand curve. B. sensitivity of quantity demanded to changes in the price of substitute goods. C. sensitivity of price to changes in the quantity demanded of substitute goods. D. sensitivity of quantity demanded to changes in price.
Competitive firms will always try to earn more than a normal profit by doing the following, except:
A. Adopting better production technology B. Improving their business organization and operation C. Developing new products D. Raising the prices of their existing products