Chapter 29 – The Economics of Race and Sex Discrimination
Chapter 29 The Economics of Race and Sex Discrimination
Multiple Choice
1. The labor force participation rate for women 16 and over has
A) increased from 38% in the 1960s to 58% today.
B) increased from 8% in the 1960s to 18% today.
C) remained steady for nearly 40 years at 50%.
D) decreased since the 1960s.
2. The labor force participation rate for men is
A) less than that of women.
B) equal to that of women.
C) greater than that of women and increasing.
D) greater than that of women but decreasing.
3. Adjusting labor force participation rates for the age of the population suggests that
A) the raw number correctly states the decrease in the rate among women.
B) the raw number overstates the increase in the rate among women.
C) the raw number understates the increase in the rate among women.
D) the labor force participation rate among women is higher than that of men.
4. The poverty rate among women is _____ of men
A) less than
B) greater than
C) roughly equal to that
D) not measured that same way to is unrelated to that
5. In terms of all income, women make ____ of what men make
A) 99%
B) 90%
C) 78%
D) 67%
Chapter 29 – The Economics of Race and Sex Discrimination
6. In terms of wages for full-time employment, men make ___ more than what women make.
A) 1%
B) 5%
C) 15%
D) 25%
7. In terms of personal bankruptcies, the incidence of filings among single women has
A) decreased substantially.
B) increased substantially.
C) decreased slightly.
D) remained steady.
8. In 2009 median income for males was $31,184 while it was ______ for females.
A) $25,633
B) $22,222
C) $20,957
D) $12,130
9. If you look at median income from all sources, women make ___ of what men make.
A) 10%
B) 67%
C) 78%
D) nearly equal
10. If you look at earnings of full-time workers, women make ___ of what men make.
A) 10%
B) 62%
C) 81%
D) nearly equal
11. In terms of median family income
A) black families earn about the same as whites.
B) black families earn about 85% of what white families earn.
C) black families earn about 62% of what white families earn.
D) black families earn about 44% of what white families earn.
Chapter 29 – The Economics of Race and Sex Discrimination
12. In terms of weekly earnings for full-time workers
A) black families earn about the same as whites.
B) black families earn about 80% of what white families earn.
C) black families earn about 58% of what white families earn.
D) black families earn about 42% of what white families earn.
13. The percentage of African-Americans whose incomes are in the top 40% of income earners
in the US is
A) about 26%.
B) about 36%.
C) about 40%
D) about 50%.
14. The percentage of African-Americans whose incomes are in the bottom 40% of income
earners in the US is
A) about 24%.
B) about 37%.
C) about 47%.
D) about 57%.
15. The unemployment rate for African-Americans is, across age categories,
A) about the same as that for whites.
B) one percentage points lower than that of whites.
C) several percentage points higher than that of whites.
D) less than half that of whites.
16. From 1987 to 1996 the number of minority owned firms has
A) grown, but only by 5 to 10 percent.
B) grown by 46%.
C) tripled.
D) actually decreased.
Chapter 29 – The Economics of Race and Sex Discrimination
17. Among the two most important methods economists use to identify illegal discrimination are
A) “regression” techniques.
B) random number simulations.
C) laboratory experiments.
D) lottery number analyses.
18. Of the following, which can be legal in hiring
A) rational discrimination.
B) disparate treatment discrimination.
C) adverse impact discrimination.
D) statistical discrimination.
19. Treating two otherwise equal people differently because of their race is called
A) “perfect” discrimination.
B) disparate treatment discrimination.
C) rational discrimination.
D) adverse impact discrimination.
20. Doing something that is not necessarily discriminatory on its face, but impacts some groups
more negatively than others is called
A) statistical discrimination.
B) disparate treatment discrimination.
C) rational discrimination.
D) adverse impact discrimination.
21. Suppose a shipping company required all applicants to lift fifty pound boxes on and off a
truck for an hour to test their strength and endurance and suppose that resulted in 50 out of
100 black applicants being hired and 10 out of 100 white applicants being hired. If this test
measured the performance required on the job then this would be an example of
A) statistical discrimination.
B) disparate treatment discrimination.
C) rational discrimination.
D) adverse impact discrimination.
Chapter 29 – The Economics of Race and Sex Discrimination
22. If, in the experience of a manager of a large company who hires for hundreds of positions per
year, whites are more likely than blacks to leave within a year, then a manager who hires
only blacks to save money is
A) employing statistical discrimination.
B) perfectly within his rights.
C) violating the law.
D) employing statistical discrimination and violating the law.
23. Suppose a plant has 1000 employees, half of whom are from a minority population. Suppose
further that, in order to cut costs, a manager must layoff 100 employees. If she chooses only
non-minority workers to layoff because an analysis of productivity data suggests they are, on
average 5% less efficient then she is
A) on perfectly sound legal ground.
B) using statistical discrimination and it is legal.
C) using inferential discrimination and it is illegal.
D) using statistical discrimination and it is illegal.
24. Statistical discrimination is “rational” in the sense that it is consistent with profit
maximization,
A) as a result it is legal.
B) as a result it is illegal.
C) so it is weighed by the courts, against how bad it looks.
D) but if statistical evidence is used to exclusively hire or fire one race or another it is illegal.
25. Treating two otherwise equal people differently because of their gender or race is called
A) statistical discrimination.
B) disparate treatment discrimination.
C) rational discrimination.
D) adverse impact discrimination.
26. Doing something that is not necessarily discriminatory on its face, but is motivated by
reference to well-established empirical regularities is
A) statistical discrimination.
B) disparate treatment discrimination.
C) rational discrimination.
D) adverse impact discrimination.
Chapter 29 – The Economics of Race and Sex Discrimination
27. If a job requires a level of strength that the average woman cannot typically achieve, then
interviewing and hiring no women would be an example of
A) statistical discrimination.
B) disparate treatment discrimination.
C) comprehensive discrimination.
D) adverse impact discrimination.
28. Requiring new 16 year old teenage male drivers to pay more for auto insurance than their 16
year old female counterparts is an example of
A) statistical discrimination.
B) disparate treatment discrimination.
C) comprehensive discrimination.
D) adverse impact discrimination.
29. Suppose a shipping company required all applicants to lift fifty pound boxes on and off a
truck for an hour to test their strength and endurance and suppose that resulted in 50 out of
100 male applicants to be hired and 10 out of 100 female applicants to be hired. If this test
measured the performance required on the job then this would be an example of
A) statistical discrimination.
B) disparate treatment discrimination.
C) comprehensive discrimination.
D) adverse impact discrimination.
30. If a restaurant hired only men to be bartenders because that is the way their patrons wanted it
this would be an example of
A) statistical discrimination.
B) disparate treatment discrimination.
C) rational discrimination.
D) adverse impact discrimination.
31. Among the two most important methods economists use to identify illegal discrimination are
A) lottery number analysis.
B) “regression” techniques.
C) “audit” methods.
D) “regression” techniques and “audit” methods.
Chapter 29 – The Economics of Race and Sex Discrimination
32. When government agents are sent as actors into a bank to test whether loans are more likely
to be granted to whites than blacks they are using a statistical technique called
A) auditing.
B) regression.
C) standard deviating.
D) quadratification.
33. When government agents use real life data on bank loans to determine if whites and blacks
are treated equally they are using the statistical technique called
A) auditing.
B) regression.
C) standard deviating.
D) quadratification.
34. When government agents are sent as actors into a bank to test whether loans are more likely
to be granted to males than females they are using a statistical technique called
A) auditing.
B) regression.
C) standard deviating.
D) quadratification.
35. When government agents use real life data on bank loans to determine if males and females
are treated equally they are using the statistical technique called
A) auditing.
B) regression.
C) standard deviating.
D) quadratification.
36. Using supply and demand to model employment discrimination, if blacks are legally
confined to certain professions then the ______ for workers in these professions is
inefficiently ______.
A) supply; high.
B) demand; high
C) supply; low
D) demand; low
Chapter 29 – The Economics of Race and Sex Discrimination
37. Using supply and demand to model employment discrimination, if blacks are legally
confined to certain professions then the wage paid to whites in other professions will be ______
and the wage paid to blacks will be ______.
A) just right; inefficiently low
B) inefficiently high; inefficiently low
C) just right; inefficiently high
D) inefficiently high; just right
38. Many economists suggest that absent legal mechanisms of discrimination, the wage paid to
whites and blacks will converge because
A) if employers can hire whites and blacks at the same wage they will hire equal numbers.
B) employers will feel guilty about hiring only whites.
C) employers will feel guilty about paying whites more when other firms pay equally.
D) it will be in the interest of profit minded employers to hire blacks, thus bidding up their
wages.
39. The removal of legal barriers alone may not be sufficient to eliminate the pay gap between
whites and blacks because the increased competition may not be able to overcome
A) the wide gap in pay.
B) employer preferences to discriminate.
C) customer preferences that lead employers to discriminate.
D) employer preferences to discriminate and customer preferences that lead employers to
discriminate.
40. If a restaurant in an integrated community has an entirely white wait-staff, economists
suggest it is
A) the employer who must be the bigoted party.
B) employers who must be reacting to bigoted consumers.
C) most likely to be due to random chance.
D) either employers discriminating for their own purposes or doing so on behalf of their
bigoted customers.
41. Looking at differences in median income to find evidence of current employment
discrimination overlooks the fact that
A) men work fewer hours per week on average.
B) men work more hours per week on average.
C) woman have less unearned income.
D) men work fewer hours per week on average and woman have less unearned income.
Chapter 29 – The Economics of Race and Sex Discrimination
42. If a woman is pregnant and her boss must decide to give a promotion that entails a move to
another city in a time frame that coincides with the expected birth of her child then the boss
A) can chose to by-pass her and give the pregnancy as a legally acceptable reason.
B) can chose to by-pass her and give the pregnancy as a legally acceptable reason as long as
the next promotion goes to her.
C) must give her the promotion regardless of other candidates.
D) must ignore the pregnancy in making the decision of whom to promote.
43. Though stay-at-home dads are growing rapidly in numbers, when one parent stays at home
___ of the time it is the mother
A) 98%
B) 88%
C) 78%
D) 68%
44. If a woman is out of the work force for 10 years while raising small children she is legally
entitled to
A) her old job back at the wage she was making at the time.
B) her old job back at what wage the current occupant of that job is making.
C) an entry level job with her old employer.
D) nothing with regard to her previous job.
45. The reasons why women are paid less than men are mainly
A) economic … they are less capable therefore paid less.
B) sociological … society imposes restrictions on women that limit their pay.
C) psychological … women only think they’re paid less.
D) political … men are in control of the political system and government controls pay.
46. Which of the following reasons why women earn less than men is considered by some to be
economic, and by others to be sociological?
A) women are the only ones who can give birth.
B) the average man is physically stronger than the average women.
C) women outnumber men.
D) women are more likely to choose low-paying, “helping” professions.
Chapter 29 – The Economics of Race and Sex Discrimination
47. Which of the following reasons why women earn less than men is considered by some to be
economic, and by others to be sociological?
A) women are the only ones who can give birth.
B) the average man is physically stronger than the average women.
C) women outnumber men.
D) women are more likely to choose flexible part-time employment to manage the needs of
their family.
48. Which of the following reasons why women earn less than men is considered by some to be
economic, and by others to be sociological?
A) women are the only ones who can give birth.
B) the average man is physically stronger than the average women.
C) women outnumber men.
D) women are more likely to choose to stay at home to raise small children.
49. Using supply and demand to model employment discrimination, if women are legally or
socially confined to certain professions such as nursing or teaching, then the ______ of
workers in these professions is inefficiently ______.
A) supply; high
B) demand; high
C) supply; low
D) demand; low
50. Using supply and demand to model employment discrimination, if women are legally or
socially confined to certain professions such as nursing or teaching, then the wage paid to
men in other professions will be ______ and the wage paid to women will be ______.
A) inefficiently low; inefficiently low
B) inefficiently high; inefficiently low
C) inefficiently low; inefficiently high
D) inefficiently high; just right
Chapter 29 – The Economics of Race and Sex Discrimination
51. Many economists suggest that absent legal mechanisms of discrimination, the wage paid
to men and women will converge because
A) if employers can hire men and women at the same wage they will hire equal numbers.
B) employers will feel guilty about hiring only men.
C) employers will feel guilty about paying men more when other firms pay equally.
D) it will be in the interest of profit minded employers to hire women, thus bidding up their
wages.
52. The removal of legal barriers alone may not be sufficient to eliminate the pay gap between
men and women because the increased competition may not be able to overcome
A) the wide gap in pay.
B) employer preferences to discriminate.
C) customer preferences that lead employers to discriminate.
D) employer preferences to discriminate and customer preferences that lead employers to
discriminate.
53. The removal of legal barriers alone may not be sufficient to eliminate the pay gap between
men and women because the increased competition may not be able to overcome
A) the wide gap in pay.
B) the indifference businesses have to profit.
C) customer preferences that lead employers to discriminate.
D) the indifference businesses have to profit and customer preferences that lead employers to
discriminate.
54. The removal of legal barriers alone may not be sufficient to eliminate the pay gap between
men and women, because the increased competition may not be able to overcome
A) the indifference businesses have to profit.
B) employer preferences to discriminate.
C) the wide gap in pay .
D) employer preferences to discriminate and the wide gap in pay.
55. An argument exists that the sociological impacts that diminish earnings by women cause
them to be the ones more likely to make career sacrifices in marriages further diminishing
their earning power. Economists call this a
A) means to an end.
B) a feedback loop.
C) a causality loop.
D) an temporal loop.
Chapter 29 – The Economics of Race and Sex Discrimination
56. The first American President to propose Affirmative Action was
A) Abraham Lincoln.
B) Lyndon Johnson.
C) Franklin Roosevelt.
D) Ronald Reagan.
57. The Labor Department under which American President began the process of “set-asides” for
minority contractors?
A) Kennedy
B) Johnson
C) Nixon
D) Reagan
58. The Supreme Court has routinely ruled that affirmative action is
A) constitutional in every form it is practiced and is at the discretion of the employer.
B) constitutional in every form as long as the State Legislature has mandated it.
C) typically constitutional as long as it meets the standard of “strict scrutiny.”
D) unconstitutional.
59. The language of the Civil Rights Act of 1964
A) expressly states that Affirmative Action shall be practiced in order to achieve equality.
B) states that no private club can discriminate in membership.
C) states that racial discrimination is illegal in the operation of public employment.
D) expressly states that Affirmative Action shall not be practiced in order to achieve
equality.
60. The language of the Civil Rights Act of 1964
A) expressly states that Affirmative Action shall be practiced in order to achieve equality.
B) states that no private club can discriminate in membership.
C) states that racial discrimination is illegal in the operation of public education.
D) expressly states that Affirmative Action shall not be practiced in order to achieve
equality.
61. The language of the Civil Rights Act of 1964
Chapter 29 – The Economics of Race and Sex Discrimination
A) expressly states that Affirmative Action shall be practiced in order to achieve equality.
B) states that no private club can discriminate in membership.
C) states that racial discrimination is illegal in the operation of public contracting.
D) expressly states that Affirmative Action shall not be practiced in order to achieve
equality.
62. The language of the California Civil Rights Initiative utilizes the structure of the
A) Clean Air Act.
B) the 22nd Amendment to the Constitution.
C) the Civil Rights Act of 1964.
D) Executive Order 11246.
63. The California Civil Rights Initiative was conceived by
A) civil rights advocates of the 1950’s.
B) opponents of Affirmative Action in the 1950’s.
C) opponents of Affirmative Action in the 1990’s.
D) civil rights advocates of the 1990’s.
64. Which of the following forms of affirmative action is unconstitutional?
A) A quota on hiring black firefighters in an urban area with a history of court-documented
discrimination.
B) A federal mandate for highway contractors to advertise for employees widely.
C) A court ordered affirmative action admissions policy for a university found to have
discriminated in the past.
D) A quota for hiring minority teachers in a public school district seeking to have a more
diverse faculty.
65. In 2003 the U.S. Supreme Court, in cases involving the University of Michigan, declared
affirmative action in college admissions
A) unconstitutional.
B) constitutional in any circumstance “for the greater good”.
C) constitutional as long as the mechanism to achieve a “critical mass” was not overly
formulaic.
D) constitutional as long as there was a precise formula that weighed race and other factors.
66. As unemployment rose during the recession of 2007-2009, black teenage unemployment
A) rose to 36.5%, a rate more than twice that of white teenagers.
Chapter 29 – The Economics of Race and Sex Discrimination
B) rose to 18.2%, a rate less than half that of white teenagers.
C) fell to 18.2%, a rate less than half that of white teenagers.
D) remained essentially unchanged.
67. The use of quotas in affirmative action are legal only when
A) necessary to achieve the employer’s diversity goals.
B) court-mandated, through a verdict or consent decree.
C) the employer is a government agency.
D) publicly advertised in newspapers, television or radio.
68. Economists Fryer and Loury argued that affirmative action
A) necessarily undermines minorities’ incentive to invest in their own education.
B) “color–blind” proxies for race easily achieve diversity without reference to race itself.
C) is the reason so many white males are passed over for promotion in favor of minorities.
D) can increase minorities’ prospective return on any investment in their own education.
69. Economists Fryer and Loury argued that affirmative action
A) necessarily undermines minorities’ incentive to invest in their own education.
B) is necessary because social networks (“who you know”) are so important in hiring
practices.
C) is the reason so many white males are passed over for promotion in favor of minorities.
D) “color–blind” proxies for race easily achieve diversity without reference to race itself.
70. Economists Fryer and Loury argued that affirmative action
A) has actually reduced the graduation and bar passage rates of African American law
students.
B) necessarily undermines minorities’ incentive to invest in their own education.
C) is the reason so many white males are passed over for promotion in favor of minorities.
D) “color–blind” proxies for race easily achieve diversity without reference to race itself.
True False
71. If customers demand to be served by white wait-staff, it is legal for restaurants to hire only
whites because it is a “business necessity.”
A) True
B) False
Chapter 29 – The Economics of Race and Sex Discrimination
72. If “minority” means less than 50% then whites are a minority.
A) true
B) false