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Adjustment costs: a. are costs incurred by a firm when it has to advertise to hire more workers. b. are costs incurred by a firm when it decides it needs to layoff workers. c. result in less employment volatility. d. […]

Suppose there is a payroll tax placed on firms. If labor supply is perfectly elastic, then a. firms and workers will split the payroll tax 50″50. b. workers will bear 75% of the tax burden. c. workers will bear 100% […]

Which of the following is an example of labor-market discrimination? a. A man who makes 5 widgets an hour is paid a higher wage than a man who makes 2 widgets an hour. b. Tim and Alexis are equally popular […]

A decrease in an individual’s wealth causes the budget set to experience a. a parallel shift outward. b. a parallel shift inward. c. a no change. d. a pivot upward. e. a pivot downward. Which of the following is NOT […]

Sharon will invest in another year of school if one more year of school costs a. $20 b. $26 c. $30 d. $50 e. all of the above Suppose the labor demand curve shifts downward. Which of the following could […]

The EITC ______ labor force participation and ______ work incentives for current labor market participants. a. encourages; may increase b. encourages; may decrease c. may encourage; increases d. may discourage; decreases e. may discourage; increases Which of the following individuals […]

If wages are below the wage level that causes supply to equal demand, then there is a. excess supply for labor. b. excess demand for labor. c. a market equilibrium. d. unemployment. e. inflation. Which of the following groups are […]

If the government decreases the payroll tax, then the equilibrium wage will and the employment level will . a. decrease, decrease b. decrease, increase c. increase, increase d. increase, decrease e. remain the same, decrease A worker’s reservation wage is […]

If capital and labor are gross substitutes in production, a. then the scale effect dominates. b. then the substitution effect dominates. c. then the scale and substitution effects are of equal magnitude. d. then capital and labor must be used […]

_______ prohibits sexual discrimination in the workplace. a. The Equal Pay Act of 1963 b. The Civil Rights Act of 1964 c. Executive Order 11246 d. The Civil Rights Act of 1991 e. The Equal Rights Act of 1991 Which […]

A worker will not participate in the labor market when a. the MC of work equal the MB. b. when the MB of work are greater than the MC. c. where . d. where . e. where . A worker’s […]

If a firm makes adjustments to create a safer working environment, then a. workers will demand higher wages. b. workers will accept lower wages. c. the firm will attract more skilled workers. d. the firm is no longer maximizing profits. […]

Some economists argue that selective withdrawal has caused: a. an increase in the observed average relative wages of those Black men who remain employed. b. White men to leave the labor market if they cannot find a job that offers […]

Suppose a competitive labor market is populated by 75% high-ability (H) workers and 25% low-ability (L) workers. Each high-ability worker produces output valued at $100 and each low-ability worker produces output valued at $20. Without job market signaling, the equilibrium […]