The mode of this distribution is:
a.10,000 workers
b.between $20,000 and $30,000
c.between $30,000 and $40,000
d.between $40,000 and $50,000
If this person were now willing to supply only H1 hours of work at W3, we could
conclude that:
a. labor supply increased (the curve shifted to the right)
b. labor supply decreased (the curve shifted to the left)
c. the person’s preferences must have changed
d. the substitution and income effects are now equal
“For married women, the substitution effect of rising wage rates has apparently
outweighed the income effect.” Empirical evidence suggests this statement is:
a. true because the labor force participation rate of women has been increasing
b. true because married women have had to work to maintain household living
standards
c. not true because the labor force participation rate of women has been increasing
d. not true because the labor force participation rate of women has been declining
Compared to white females, the labor force participation rate of African-American
females is _____. Compared to white males the labor force participation rate of
African-American males is _____.
a. nearly identical; nearly identical
b. greater; lower
c. lower; greater
d. nearly identical; lower
The collective amount of economic rent being earned by workers in this competitive
market is:
a.zero
b.ACD
c.ABD
d.0ADE
Older workers are less likely to migrate because older workers:
a.have typically accumulated more possessions, raising the direct cost of moving
b.are more likely to have to give up seniority and pension benefits
c.are more likely to have high psychic costs of moving
d.all of the above
Tournament pay:
a. reduces profits because of the excessive pay to chief executive officers implied by
such plans
b. may help to rationalize why some ineffective senior executives continue to be
employed by a firm
c. explains why “hostile” corporate takeovers occur
d. explains why chief executive officers typically serve long periods at the top of their
companies
Family background influences an individual’s earnings:
a.directly, but not through any indirect effects on human capital decisions
b.*directly, and indirectly through greater investments in human capital
c.indirectly through greater investments in human capital, but not directly
d.directly, and indirectly through its impact on discrimination
The term natural rate of unemployment refers to the unemployment rate that will occur:
a.whenever the actual rate of inflation exceeds the actual rate
b.if the actual rate of inflation is zero
c.if the expected rate of inflation is zero
d.in the long run if the actual rate of inflation equals the expected rate
Compared to the allocatively efficient amount, a monopsonist tends to hire:
a. too few workers because the value of marginal product exceeds marginal revenue
product
b. too few workers because marginal wage cost exceeds the wage rate
c. too many workers because the value of marginal product exceeds marginal revenue
product
d. too many workers because marginal wage cost exceeds the wage rate
Empirical studies of public-sector pay conclude that:
a.public-sector pay is comparable to private-sector pay, as required by law
b.the occupational wage structure is less egalitarian than in the private sector
c.the pay premium is greater for highly-skilled workers than for low-skilled workers
d.the pay premium is greater for African Americans and females than for white males
Suppose this labor market is monopsonistic, so that the wage is W1 and employment is
Q1. If W* is imposed as the minimum wage, then employment in this market:
a.will riseto Q2
b.will rise to Q4
c.will fall
d.will remain the same
The measured union wage advantage in this market is: (Wages in both the union and
nonunion sectors are initially $10. The union then negotiates a wage rate of $12. The
post-negotiation nonunion wage is not yet known.)
a.20%
b.25%
c.$2
d.More information is needed
Which one of the following topics is most suited to microeconomic analysis?
a. The average level of real wages
b. The unemployment rate
c. The average level of labor productivity
d. Mobility and migration decisions
In which industry is the relatively high extent of unionism and union membership
growth explained by the favorable legislative climate of the 1960s and 1970s?
a.Finance, insurance and real estate
b.Wholesale and retail trade
c.Transportation, communication and public utilities
d.Public Administration
Which of the following occupations was less than 60% female in 2011?
a. Physicians and surgeons
b. Cashiers
c. Elementary and middle school teachers
d. Waiters and waitresses
The slope of an isoquant at any point reflects the:
a. elasticity of demand for labor
b. isocost line
c. price of capital relative to labor
d. marginal rate of technical substitution
Assume the two labor demand curves are identical, and that all union workers who lose
their job as a result of the union wage increase from Wn to Wu find jobs in the nonunion
sector. The area corresponding to the efficiency loss is: (all product markets are
assumed to be competitive.)
a.c’abd’c.eabf
b.WnWua c’d.gcdh
Allocative efficiency is achieved when:
a. the marginal product of labor equals its value of marginal product
b. all resources are fully employed
c. the price of each resource equals the value of its marginal product
d. the price of each resource equals the value of its marginal product and its marginal
opportunity cost
The firm’s isoprofit curve, P, is shown as concave to the origin, reflecting the
assumption that:
a. the firm faces a constant trade-off between job safety and wages
b. each successive increase in job safety comes at a decreasing expense to the firm
c. each successive increase in job safety requires a smaller drop in wages to maintain
normal profits
d. each successive increase in job safety comes at an increasing expense to the firm
Which one of the following government policies would most likely be used to reduce
frictional unemployment?
a.Job matching programs
b.Expansionary fiscal policy
c.Job training and retraining programs
d.Expansionary monetary policy
Which one of the following non-discriminatory factors may account for lower observed
wages for women compared to men?
a. Women have stronger preferences for job safety
b. “Full-time” females actually work more hours than “full-time” males
c. Men expect to change jobs more often than women
d. Men have higher levels of “general” training, while women’s training is more
‘specific”
Empirical estimates of OSHA’s effectiveness at reducing risk of injury and death on the
job have:
a.been mixed
b.shown no changes at all in fatal or non-fatal injuries
c.shown substantial reductions in both fatal and non-fatal injury rates
d.shown substantial increases in both fatal and nonfatal injury rates
An example of a union federation is the:
a.American Medical Association
b.Air Line Pilots Association
c.United Auto Workers
d.AFL-CIO
Allowing for changes in product demand, the relationship between productivity growth
and employment growth across industries over the past ten years is best described as:
a.positive
b.negative
c.”U”-shaped
d.random
Rather than the product demand schedule shown in the table, suppose this firm sold its
output competitively for a price of $2.00. In this case, how many workers will this
profit-maximizing firm choose to employ at a wage of $25.00? (Assume that the labor
market is perfectly competitive.)
a. 2
b. 3.
c. 4
d. 5
Which of the following equalities holds when the profit-maximizing quantity of labor is
employed in the shortrun?
a. MRP = MWC
b. MP = wage rate
c. MRP = AP
d. MRP = 0
All else equal, rising real wages will:
a. decrease average weekly work hours if the income effect exceeds the substitution
effect
b. increase average weekly work hours if the income effect exceeds the substitution
effect
c. decrease average weekly work hours if the substitution effect exceeds the income
effect
d. have no impact on average weekly work hours
Unions may increase economic efficiency by:
a.providing an “exit” mechanism
b.insisting promotions be based on ability rather than seniority
c.imposing restrictive work rules
d.reducing worker turnover
Compared to the monopoly union outcome, wage and employment contracts along the
bargaining curve between x and y entail: (π1 and π2 are a firm’s isoprofit curves. The
monopoly union outcome is given by point ū.)
a.higher utility to the union and higher profits to the firm
b.higher utility to the union but lower profits to the firm
c.higher profits to the firm but lower utility to the union
d.lower utility to the firm and lower profits to the firm