978-1259723223 Test Bank TBChap017 Part 6

209. A major function of the National Labor Relations Board is to

210. Which of the following is correct?

A. The federal government can delay any strike for 80 days.

211. Those who feel that unions positively affect productivity and efficiency argue that unions

are

D. “exit mechanisms” that accelerate labor turnover.

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Dif f i c u l t y :

02 Medium

Learning Objective: 17–09 (Appendix) Relate who belongs to U.S. unions, the basics of

collective bargaining, and the economic effects of unions.

Test Bank: I

Topi c :

Labor Unions and Their Impacts

212. By reducing labor turnover, unions may increase productivity because a lower turnover

rate

A. results in a less-experienced workforce.

213. Some economists claim that unions reduce economic efficiency by

A. providing a voice mechanism for workers.

214. Unions may increase productivity by

A. providing an exit mechanism for workers.

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D. providing a voice mechanism for workers.

215. Featherbedding refers to

A. a situation in which a union forces an employer to hire union workers in preference to

nonunion workers.

216. Available research suggests that the union wage advantage diminishes the national output

by

A. 15 percent.

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217. Suppose a worker feels unhappy with his job and consequently quits. This illustrates

A. the voice mechanism.

218.

Assumptions: These two graphs show two sectors of the labor market for a particular kind of

labor. Relevant product markets are competitive. The two labor demand curves are identical.

Initially the quantities of labor employed in the two sectors are L1 and L’1, and the wage rate in

each sector is Wn. If a union is formed in sector 1 and the union increases the wage rate from

Wn to Wu, then employment will

219.

Assumptions: These two graphs show two sectors of the labor market for a particular kind of

labor. Relevant product markets are competitive. The two labor demand curves are identical.

Initially the quantities of labor employed in the two sectors are L1 and L’1, and the wage rate in

each sector is Wn. The change in employment in sector 1 to which a Wn to Wu

union wage

increase gives rise will cause output in that sector to

A. decrease by A + B.

220.

Assumptions: These two graphs show two sectors of the labor market for a particular kind of

labor. Relevant product markets are competitive. The two labor demand curves are identical.

Initially the quantities of labor employed in the two sectors are L1 and L’1, and the wage rate in

each sector is Wn. If all the workers who lose their jobs in the union sector because of a Wn to

Wu union wage increase are reemployed in nonunion sector 2, output in that sector will

A. decrease by F + G.

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221.

Assumptions: These two graphs show two sectors of the labor market for a particular kind of

labor. Relevant product markets are competitive. The two labor demand curves are identical.

Initially the quantities of labor employed in the two sectors are L1 and L’1, and the wage rate in

each sector is Wn. This analysis suggests that a union wage advantage of Wu

minus Ws causes

a net efficiency

A. loss equal to E – A.

222. Empirical studies suggest that the efficiency loss associated with the misallocation of labor

caused by the union wage advantage is

A. $6 billion per year.

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D. about 4 percent of domestic output.

223. Which of the following statements is correct?

A. There is clear evidence that unions have increased the average level of real wage rates for

all workers.

224. Which one of the following research findings is most consistent with the hypothesis that

unions increase productivity?

A. Other things equal, firm profits are lower where unions are present.

Test Bank: I

Topi c :

Labor Unions and Their Impacts

True / False Questions

225. Since the mid-1950s, union membership has declined as a percentage of employed wage

and salary workers.

226. The rate of unionization is substantially higher for protective service workers than for

sales workers.

227. Unions prefer agency shops to open shops.

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Test Bank: I

Topi c :

Labor Unions and Their Impacts

228. There is no evidence that unions are able to increase wage rates above those that the

market would otherwise provide.

229. Union workers have higher rates of job turnover than do nonunion workers.

230. Right–to-work laws prohibit the formation of labor unions.

231. The presence of an agency shop requires all workers to join the union within the first 30

days of employment.

232. Seven of the 50 states account for approximately half of all union members in the United

States.

233. African Americans have higher unionization rates than whites.

234. In 2015, approximately 5 percent of all work time lost was due to work stoppages.

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AACSB: Knowledge Application

A c c e s s i b i l i t y :

Keyboard Navigation

Blooms: Understand

Dif f i c u l t y :

02 Medium

Learning Objective: 17–09 (Appendix) Relate who belongs to U.S. unions, the basics of

collective bargaining, and the economic effects of unions.

Test Bank: I

Topi c :

Labor Unions and Their Impacts

Multiple Choice Questions

235. The concept of “wages” includes the following items, except

A. direct money payments like salaries and commissions.

236. Other things constant, which of the following is inversely related to inflation?

A. nominal wage only

237. If the price level rises by 4 percent in a year and nominal wages increase by 2 percent,

then real wages will

A. decrease by 6 percent.

238. Assume that your nominal wage was fixed at $15 an hour, and the price index rose from

100 to 105. In this case, your real wage has

A. decreased to $10.

239. Real wages would rise if the

A. prices of goods and services rose more rapidly than nominal-wage rates.

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so closely over time.

Test Bank: II

Topic:

Labor, Wages, and Earnings

240. Which statement is correct?

A. The percentage change in the nominal wage plus the percentage change in the price level

equals the percentage change in the real wage.

241. The consumer price index is 113 in Year 1 and 118 in Year 2. The nominal wage rate is $8

in Year 1 and $9 in Year 2. What is the approximate percentage change in the real wage rate

from Year 1 to Year 2?

A. 2 percent

242. Nominal monthly wages increase from $1,500 to $1,800, while the price level increases

by 4 percent. The percentage change in real monthly wages is about

A. 10 percent.

243. The nominal annual wage increases from $20,000 to $21,000, while the price level

increases by 7 percent. In this case, the percentage change in the real annual wage is about

A. −1 percent.

244. Productivity measures (such as output per worker-hour) and wage rates adjusted for

inflation in the United States are

A. inversely related.

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Learning Objective: 17–01 Explain why labor productivity and real hourly compensation track

so closely over time.

Test Bank: II

Topic:

Labor, Wages, and Earnings

245. Which of the following has not been a major factor contributing to the high productivity of

labor in the United States?

D. high levels of capital investment

246. Which of the following is an explanation for the high labor-productivity in the United

States?

D. plentiful labor resources

247. Which of the following is a valid explanation for real wage growth?

A. the rising cost of capital accumulation

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D. a rising rate of labor productivity growth

248. The basic explanation for high real wages in the United States and other industrially

advanced economies is that the

A. labor supply has increased more rapidly than labor demand in these nations.

249. In considering real-world situations, we must recognize the fact that by “wages” in this

chapter, we mean the following, except the

A. total price that employers pay to obtain labor.

250. In recent years, total compensation to workers has risen faster than the take-home pay of

average workers. This implies that

A. something is wrong with the statistics on either compensation or take-home pay.

251. According to the Conference Board data for 2013, which of the following nations had

significantly higher hourly wages for production workers compared to the U.S.?

D. Canada

252. A characteristic of a purely competitive labor market would be

A. “price-maker” behavior by the workers.

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Blooms: Understand

Dif f i c u l t y :

02 Medium

Learning Objective: 17–02 Show how wage rates and employment levels are determined in

competitive labor markets.

Test Bank: II

Topic:

A Purely Competitive Labor Market

253. In a purely competitive labor market, a profit-maximizing firm will hire labor up to the

point where the marginal revenue product of labor equals the

D. average cost of each unit of output.

254. A firm finds that it must increase wages to attract extra workers. The firm will hire labor

up to the point where the marginal

A. product of labor equals the wage rate.

255. If the supply of labor in a purely competitive labor market increases, then the product

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B. supply curve for a single employer will shift to the left.

C. demand curve for a single employer will shift to the right.

D. demand curve for a single employer will shift to the left.

256. A firm that hires labor and sells its product both in purely competitive markets will

A. have a horizontal demand curve for labor.

257. If the wage rate in a purely competitive labor market increases, it will cause the

A. marginal resource cost curve for a single competitive firm in the industry to shift down.