When graphing a workers indifference curves in Probability of Injury (x-axis) versus
Wage (y-axis) space, Als indifference curves are steeper than Petes indifference curve.
In this case:
A. Al is more risk-loving than Pete.
B. Al requires a greater wage increase than Pete in order to willingly take on more risk.
C. Al will end up receiving a higher wage than Pete.
D. Both are risk neutral.
E. Al will only accept a job if it offers no risk of injury.
Compared to older workers with several years of experience with one firm, newly hired
young workers typically
A. have higher turnover.
B. have more on-the-job training.
C. have more experience.
D. are likely to stay with their job longer.
E. tend to earn more than their experienced colleagues.
Which of the following is a problem with comparable worth programs?
A. Women will be paid more than men when their job scores” are the same.
B. Workers will be less likely to train in occupations or move to those jobs where they
have the largest value of marginal product.
C. Jobs traditionally filled by women will find it difficult to fill vacancies.
D. Men will replace women in traditional female occupations.
E. Women will be unable to perform jobs traditionally held by men.
Under normal circumstances, the equilibrium compensation wage differential is the
wage differential that exactly attracts
A. the average worker into a regular job.
B. the marginal worker into a risky job.
C. the average worker into a less risky job.
D. the marginal worker into the labor market.
E. the average high-skilled worker into a low-skill job.
Which one of the following statements regarding job turnover is false for the U.S. labor
market?
A. The quit rate is almost always higher than the layoff rate.
B. The overall separation rate is much higher for younger workers than older workers.
C. The rate of job loss is highest for the least educated.
D. Workers who have a lot of seniority are likely to switch to a different firm when their
wage-age profile begins to flatten out.
E. Men are much more likely to hold a long term job than are women.
The Mincer earnings function is used to estimate
A. ability bias.
B. the signaling effect.
C. the social return to schooling.
D. the value of the marginal product of labor.
E. the age earnings profile.
Social mobility refers to
A. the ability for a worker to move up in a firms hierarchy.
B. the ability for a worker to increase his or her human capital.
C. the link between the skills and income of parents and children.
D. the relationship between human capital and wages.
E. the degree to which society dictates the wage distribution.
The short-run Phillips curve is __________, while the long-run Phillips curve is vertical
at the __________.
A. downward sloping; real wage
B. downward sloping; natural rate of unemployment
C. upward sloping; minimum wage
D. upward sloping; average nominal wage rate
E. horizontal; origin
Which of the following statements is false?
A. Profit sharing redistributes profits back to the workers.
B. Bonuses are frequently linked to performance.
C. Bonuses are paid in addition to base salary.
D. Free-riding can result from a compensation scheme that gives competitive individual
bonuses.
E. Free-riding can result from profit sharing.
Assuming consumption and leisure are normal goods, hours worked will fall when the
wage increases if
A. the income effect dominates the substitution effect.
B. the substitution effect dominates the income effect.
C. the income and substitution effect move in the same direction (i.e., if they are of the
same sign).
D. the income and substitution effect move in the opposite direction (i.e., if they are of
the opposite sign).
E. the wage increase is accompanied by an increase in prices.
Of the 500,000 people (age 16+) in a particular country, 300,000 people are in the labor
force. Of these, 240,000 are employed and 60,000 are unemployed. Of the 200,000
workers not in the labor force, 20,000 want jobs but have given up looking for one.
What is the unemployment rate if discouraged workers are counted as being
unemployed?
A. 10%
B. 20%
C. 25%
D. 48%
E. 60%
Empirically, the relationship between CEO performance (measured in terms of share
price) and CEO compensation is
A. large and positive.
B. small and positive.
C. nonexistent.
D. small and negative.
E. large and negative.
Labor market equilibrium is best characterized by:
A. A wage at which all people have a job.
B. A wage at which all workers are above the poverty level.
C. A wage at which the number of people willing to work equals the number of workers
firms are willing to hire.
D. A minimum wage at which everyone is willing to work.
E. All workers receiving their ideal wage.
When the government imposes a payroll tax on workers,
A. the effects are identical to the effects had the government imposed the tax on
employers.
B. the costs of hiring remain constant.
C. the labor supply curve shifts to the right.
D. total employment remains constant.
E. workers real wages are unchanged.
An upward-sloping labor supply curve implies that
A. a firm can always hire more workers, even without increasing the wage.
B. more workers are willing to work when wages are low.
C. more workers are willing to work as the market wage increases.
D. labor supplied is fixed.
E. there is a continuously increasing demand for labor.
Suppose labor supply can be described as ES = 0.1w – 1,000 where w is yearly salary.
What yearly salary must be paid to encourage 6,000 workers to accept jobs?
A. $30,000
B. $40,000
C. $50,000
D. $60,000
E. $70,000