1. Which of the following is correct?
a.
Union membership in the United States peaked in the 1940s and 1950s.
b.
Unions play a larger role in the United States than in European countries such as Belgium, France, and
Germany.
c.
Because of the popularity of unions, most workers in the United States discuss their wages, benefits, and
working conditions with their employers as a group.
d.
Collective bargaining is the process by which unions negotiate membership dues with the National Labor
Relations Board.
2. Which of the following is not correct?
a.
b.
c.
d.
3. In Belgium, Norway, and Sweden, the percentage of workers who belong to unions is
a.
almost zero.
b.
less than it is in the United States.
c.
about the same as it is in the United States.
d.
greater than it is in the United States.
4. Since the 1940’s U.S. union membership has
a.
fallen. This decline should have reduced structural unemployment.
b.
fallen. This decline should not have reduced structural unemployment.
c.
risen. This increase should have raised structural unemployment.
d.
risen. This increase should not have raised structural unemployment.
5. Labor unions
a.
raise wages in unionized industries.
b.
create labor shortages in non-unionized industries.
c.
play a larger role in the current U.S. economy than in European countries such as Norway and Sweden.
d.
prefer to operate in states with right-to-work laws.
6. Labor unions
a.
prefer to operate in states with right-to-work laws.
b.
are similar to cartels.
c.
play a larger role in the current U.S. economy than in European countries such as Norway and Sweden.
d.
attract a membership of about 25 percent of current U.S. workers.
7. Sam has no job but keeps applying to get a job with a business that is unionized. He is qualified and he finds the pay
attractive, but the firm is not hiring. Sam is
a.
structurally unemployed. Structural unemployment exists even in the long run.
b.
structurally unemployed. Structural unemployment does not exist in the long run.
c.
frictionally unemployed. Frictional unemployment exists even in the long run.
d.
frictionally unemployed. Frictional unemployment does not exist in the long run.
8. Which of the following is not correct?
a.
When a union is present in a labor market, wages are not determined by the equilibrium of supply and
demand.
b.
Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power.
c.
The process by which unions and firms agree on the terms of employment is called a strike.
d.
Most workers in the U.S. economy are not members of a union.
9. Which of the following is not correct?
a.
When a union is present in a labor market, wages are determined by the equilibrium of supply and demand.
b.
Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power.
c.
The process by which unions and firms agree on the terms of employment is called collective bargaining.
d.
Most workers in the U.S. economy are not members of a union.
10. Which of the following is not correct?
a.
When a union is present in a labor market, wages may not be determined by the equilibrium of supply and
demand.
b.
Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power.
c.
When unions raise wages above equilibrium, the quantity of labor supplied decreases, and the quantity of labor
demanded increases.
d.
Most workers in the U.S. economy are not members of a union.
11. When a union raises the wage above the equilibrium level, it
a.
reduces both the quantity of labor supplied and the quantity of labor demanded.
b.
reduces the quantity of labor supplied and raises the quantity of labor demanded.
c.
raises the quantity of labor supplied and reduces the quantity of labor demanded.
d.
raises both the quantity of labor supplied and the quantity of labor demanded.
12. Collective bargaining refers to
a.
the process by which the government sets exemptions from the minimum wage law.
b.
setting the same wage for all employees to prevent conflict among workers.
c.
firms colluding to set the wages of employees below equilibrium.
d.
the process by which unions and firms agree on the terms of employment.
13. Which of the following is not correct?
a.
An organized withdrawal of labor from a firm by a union is called a strike.
b.
The power of a union comes from its ability to strike if the union and the firm do not agree on the terms of
employment.
c.
Economists who study the effects of unions typically find that union workers earn about 25 to 35 percent more
than similar workers who do not belong to unions.
d.
Workers in unions reap the benefit of collective bargaining, while workers not in unions bear some of the cost.
14. Economists have found that union workers earn what percent more than similar nonunion workers?
a.
0 to 5
b.
5 to 10
c.
10 to 20
d.
20 to 30
15. When a union raises the wage above the equilibrium level,
a.
both the quantity of labor supplied and unemployment rise.
b.
both the quantity of labor supplied and unemployment fall.
c.
the quantity of labor supplied rises and unemployment falls.
d.
the quantity of labor supplied falls and unemployment rises.
16. When a union bargains successfully with employers, in that industry,
a.
both the quantity of labor supplied and the quantity of labor demanded increase.
b.
both the quantity of labor supplied and the quantity of labor demanded decrease.
c.
the quantity of labor supplied increases and the quantity of labor demanded decreases.
d.
the quantity of labor demanded increases and the quantity of labor supplied decreases.
17. When a union bargains successfully with employers, in that industry,
a.
both wages and unemployment increase.
b.
wages increase and unemployment decreases.
c.
wages decrease and unemployment increases.
d.
both wages and unemployment decrease.
18. The introduction of a union into an industry
a.
raises wages and employment in that industry.
b.
lowers wages and employment in that industry.
c.
lowers wages and raises employment in that industry.
d.
raises wages and lowers employment in that industry.
19. The introduction of a union into an industry creates a
a.
surplus of labor and so raises unemployment.
b.
surplus of labor and so reduces unemployment.
c.
shortage of labor and so raises unemployment.
d.
shortage of labor and so reduces unemployment.
20. Which of the following do unions not cause?
a.
frictional unemployment
b.
the wage to rise above the equilibrium level
c.
conflict between insiders who benefit from high union wages and outsiders who do not get the union jobs
d.
reduced wages in industries without unions
21. If outsiders had more say in union contracts then it is likely that union wages would be
a.
higher so unemployment would be higher.
b.
higher so unemployment would be lower.
c.
lower so unemployment would be higher.
d.
lower so unemployment would be lower.
22. Unions contribute to
a.
cyclical unemployment.
b.
frictional unemployment.
c.
seasonal unemployment.
d.
structural unemployment.
23. Unions contribute to
a.
frictional but not structural unemployment.
b.
structural but not frictional unemployment.
c.
both frictional and structural unemployment.
d.
neither frictional nor structural unemployment.
24. Unions contribute to
a.
structural unemployment but not the natural rate of unemployment.
b.
the natural rate of unemployment but not structural unemployment.
c.
both structural unemployment and the natural rate of unemployment.
d.
neither structural unemployment nor the natural rate of unemployment.
25. Unions contribute to
a.
frictional unemployment but not the natural rate of unemployment.
b.
the natural rate of unemployment but not frictional unemployment.
c.
both frictional unemployment and the natural rate of unemployment.
d.
neither frictional unemployment nor the natural rate of unemployment.
26. Unions
a.
do not affect the natural rate of unemployment.
b.
lower the wages of unionized workers.
c.
raise the profits of unionized firms.
d.
lower the wages of workers in industries without unions.
27. Unions
a.
raise the wages of unionized workers and raise unemployment.
b.
raise the wages of unionized workers and reduce unemployment.
c.
reduce the wages of unionized workers and raise unemployment.
d.
reduce the wages of unionized workers and reduce unemployment.
28. If unions were formed in more industries, the supply of labor in other industries would
a.
increase, causing employment in other industries to rise.
b.
increase, causing employment in other industries to fall.
c.
decrease, causing employment in other industries to rise.
d.
decrease, causing employment in other industries to fall.
29. The effects of unionization on wages in the sectors of the economy that are unionized causes the supply of labor in
other sectors of the economy to
a.
decrease, raising wages in industries that are not unionized.
b.
decrease, reducing wages in industries that are not unionized.
c.
increase, raising wages in industries that are not unionized.
d.
increase, reducing wages in industries that are not unionized.
30. Suppose that roofers are not unionized. If roofers unionize, then the supply of labor in other sectors of the economy
will
a.
decrease, raising wages in industries that are not unionized.
b.
decrease, reducing wages in industries that are not unionized.
c.
increase, raising wages in industries that are not unionized.
d.
increase, reducing wages in industries that are not unionized.
31. Suppose that neither food-service workers nor retail salespeople are unionized. If food-service workers unionize, then
the supply of retail salespeople will
a.
rise, as will the wages of retail salespeople.
b.
rise, and the wages of retail salespeople will fall.
c.
fall, as will the wages of retail salespeople.
d.
fall, and the wages of retail salespeople will rise.
32. Suppose that bartenders and waiters have no unions. Now suppose that bartenders form a union. What does this do the
labor supply and wages of waiters?
a.
Both labor supply and wages increase.
b.
Labor supply increases, and wages decrease.
c.
Labor supply decreases, and wages increase.
d.
Both labor supply and wages decrease.
33. Suppose that garbage collectors and landscaping workers have no unions. Now suppose that garbage collectors form
unions. What does this do to the labor supply and wages of landscaping workers?
a.
Both labor supply and wages increase.
b.
Labor supply increases, and wages decrease.
c.
Labor supply decreases, and wages increase.
d.
Both labor supply and wages increase.
34. Consider two labor markets in which jobs are equally attractive in all respects other than the wage rate. All workers
are equally able to do either job. Initially, both labor markets are perfectly competitive. If a union organizes workers in
one of the markets, then the wage rates will tend to
a.
rise in both markets.
b.
fall in both markets
c.
rise for the union jobs, but remain unchanged for the nonunion jobs.
d.
rise for the union jobs and fall for the nonunion jobs.
35. Suppose that medical technicians and nurses’ aides are not unionized. If the nurses’ aides unionize, then the wages of
a.
both medical technicians and nurses’ aides will rise.
b.
both medical technicians and nurses’ aides will fall.
c.
medical technicians will rise, and the wages of nurses’ aides will fall.
d.
nurses’ aides will rise, and the wages of medical technicians will fall.
36. Suppose that florists and landscape workers are not unionized. If florists unionize, then the wages of
a.
florists will rise, and the wages of landscape workers will fall.
b.
florists will fall, and the wages of landscape workers will rise.
c.
both florists and landscape workers will rise.
d.
both florists and landscape workers will fall.
37. Suppose that college professors at public universities are unionized. If public university college professors change
their minds and vote not to be unionized, the quantity of public university college professors demanded will
a.
rise. The supply of workers in other similar professions will also rise.
b.
rise. The supply of workers in other similar professions will fall.
c.
fall. The supply of workers in other similar professions will rise.
d.
fall. The supply of workers in other similar professions will also fall.
38. Suppose that dental hygienists are unionized in the eastern region of the country but not in the western region. If the
unionized workers in the eastern region abolished their unions, employment
a.
and wages of dental hygienists in the eastern region would rise.
b.
of dental hygienists in the eastern region would rise, but wages of dental hygienists in the eastern region would
fall.
c.
and wages of dental hygienists in the eastern region would fall.
d.
of dental hygienists in the eastern region would fall, but wages of dental hygienists in the eastern region would
rise.
39. Which of the following is not correct?
a.
Unions are exempt from U.S. antitrust laws.
b.
The Wagner Act of 1935 prevents U.S. employers from interfering when workers try to organize unions.
c.
The National Labor Relations Board is the U.S. government agency that enforces workers’ right to unionize.
d.
Right-to-work laws prevent firms from hiring permanent replacements for workers who are on strike.
40. The Wagner Act of 1935
a.
prevents unions from acting as cartels.
b.
allows workers joining a unionized firm to choose not to join the union.
c.
prevents employers from interfering when workers try to organize a union.
d.
prevents firms from hiring permanent replacements for workers who are on strike.
41. The National Labor Relations Board
a.
enforces antitrust laws against unions.
b.
enforces workers’ rights to unionize.
c.
acts as a union’s representative in collective bargaining.
d.
is required to approve all collective bargaining agreements before they can be enforced.
42. Right-to-work laws
a.
guarantee workers the right to form unions.
b.
give workers in a unionized firm the right to choose whether to join the union.
c.
prevent employers from hiring permanent replacements for workers who are on strike.
d.
prevent workers from being fired because of increases in wages brought about by collective bargaining.
43. In the absence of right-to-work laws, workers
a.
that went on strike could be permanently replaced.
b.
might be required to join the union if they worked for a unionized firm.
c.
would not be able to unionize.
d.
would not be able to strike.
44. Which of the following is correct?
a.
There is consensus among economists that unions are good for the economy.
b.
There is consensus among economists that unions are bad for the economy.
c.
There is consensus among economists that, on net, unions have almost no impact on macroeconomic variables.
d.
There is no consensus among economists about whether unions are good or bad for the economy.
45. There is a clear consensus among economists that unions are
a.
good for the economy because they result in higher wages for most workers.
b.
good for the economy because they are a necessary antidote to the market power of employers.
c.
bad for the economy because they are cartels and therefore detrimental to an efficient allocation of resources.
d.
None of the above is correct; there is no clear consensus among economists about whether unions are good or
bad for the economy.
46. Which of the following is correct?
a.
In unionized industries, wages are above the level that would prevail in competitive markets.
b.
The introduction of a union in some industry reduces the quantity of labor demanded in that industry, causes
some workers in that industry to be unemployed, and reduces wages in the rest of the economy.
c.
Critics argue that the allocation of labor resulting from unions is both inefficient and inequitable.
d.
All of the above are correct.
47. Which of the following is correct?
a.
In unionized industries, wages are below the level that would prevail in competitive markets.
b.
The introduction of a union in an industry increases the quantity of labor demanded in that industry, causes
some workers in that industry to be unemployed, and increases wages in the rest of the economy.
c.
Critics argue that the allocation of labor resulting from unions is both inefficient and inequitable.
d.
All of the above are correct.
48. Which of the following is correct?
a.
In unionized industries, wages are below the level that would prevail in competitive markets.
b.
The introduction of a union in an industry reduces the quantity of labor demanded in that industry, causes
some workers in that industry to be unemployed, and reduces wages in the rest of the economy.
c.
There is a strong consensus among economists that unions are bad for the U.S. economy.
d.
All of the above are correct.
49. Which of the following is not a contention of advocates of unions?
a.
Unions are a necessary antidote to the market power of the firms that hire workers.
b.
In the case of a “company town,” a union may balance the firm’s market power and protect the workers from
being at the mercy of the firm’s owners.
c.
The introduction of a union benefits all workers in a firm.
d.
Unions are important for helping firms respond efficiently to workers’ concerns.
50. Which of the following is correct?
a.
Nearly all economists believe that unions are bad for the economy as a whole.
b.
Unionized firms pay wages above the competitive equilibrium level.
c.
Unions increase the level of employment in unionized firms.
d.
Unions decrease the level of employment in firms without unions.
51. If a union raises the wage in its industry above equilibrium, then there is an increase in
a.
structural unemployment which is part of cyclical unemployment.
b.
structural unemployment which is part of the natural rate of unemployment.
c.
frictional unemployment which is part of cyclical unemployment.
d.
frictional unemployment which is part of the natural rate of unemployment.
52. If a union raises the wage in its industry above equilibrium then employment in that industry
a.
and non-unionized industries falls.
b.
falls and employment in non-unionized industries rises.
c.
rises and falls in non-unionized industries.
d.
and non-unionized industries rises.