A Change in the Real Wage Rate Measures the Change

question 177

Multiple Choice

A change in the real wage rate measures the change in the

• A)price of goods and services that an hour's work can buy.
• B)nominal wage of an hour's work.
• C)quantity of goods and services that an hour's work can buy.
• D)inflation rate affecting the labor market.
• E)CPI.

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Definitions:

Marginal Revenue Product

The additional revenue generated from using one more unit of a factor of production.

Marginal Expenditure

The supplementary cost resulting from acquiring an extra unit of a good or service.

Economic Rent

Economic rent is the excess payment made to or received by a factor of production over and above what would have been needed to bring that factor into production.

Competitive Factor Market

A market for inputs where firms purchase resources necessary for production, characterized by many sellers and buyers.