Question 1

As long as there are advancements in technology, some workers will be temporarily displaced.

Accepted Answer

A) True 
 B)False

Question 2

Exhibit 27-8 ​
 
Refer to Exhibit 27-8. If the monopsonist could perfectly discriminate by paying each worker a different wage rate, the number of workers employed would be

Accepted Answer

A) Q1. 
B) Q2. 
C) Q3. 
D) Q4. 
E) Q5. 
A) Q1. 
B) Q2. 
C) Q3. 
D) Q4. 
E) Q5.

Question 3

Unions are interested in increasing the productivity of their members because as their productivity rises, the __________ their labor __________ and their wages __________.

Accepted Answer

A) demand for; falls; rise. 
B) demand for; rises; rise. 
C) supply of; rises; rise. 
D) supply of; falls; rise. 
A) demand for; falls; rise. 
B) demand for; rises; rise. 
C) supply of; rises; rise. 
D) supply of; falls; rise.

Question 4

The lower the elasticity of demand is for labor, the greater will be the cutback in labor for any given wage increase.

Accepted Answer

A) True 
 B)False

Question 5

Exhibit 27-7 ​   Refer to Exhibit 27-7. As the firm increases employment from 30 to 40 workers, its total labor cost

Accepted Answer

A) decreases by $190. 
B) increases by $190. 
C) increases by $60. 
D) increases by $170. 
A) decreases by $190. 
B) increases by $190. 
C) increases by $60. 
D) increases by $170.

Question 6

Exhibit 27-5 ​
 
Refer to Exhibit 27-5. In which of the following cases has the increase in the wage from W1 to W2 been brought about by a country-wide legalization of union shops?

Accepted Answer

A) (1) 
B) (2) 
C) (3) 
D) There is not enough information provided to answer this question. 
A) (1) 
B) (2) 
C) (3) 
D) There is not enough information provided to answer this question.

Question 7

A monopsonist's wage rate is

Accepted Answer

A) the same as marginal factor cost. 
B) greater than marginal factor cost. 
C) less than marginal factor cost. 
D) the same as marginal revenue product. 
A) the same as marginal factor cost. 
B) greater than marginal factor cost. 
C) less than marginal factor cost. 
D) the same as marginal revenue product.

Question 8

It is possible for an increase in minimum wage to increase the number of workers hired in a competitive labor market, but not in a monopsony setting.

Accepted Answer

A) True 
 B)False

Question 9

Exhibit 27-12   Refer to Exhibit 27-12.  The profit-maximizing number of workers to hire for this firm is

Accepted Answer

A) 2. 
B) 3. 
C) 4. 
D) 5. 
E) 6. 
A) 2. 
B) 3. 
C) 4. 
D) 5. 
E) 6.

Question 10

An American labor union worker has a picket sign that reads "Say No to Tokyo, Buy American." Most likely, the worker is trying to

Accepted Answer

A) increase the price of substitute factors. 
B) decrease the price of substitute factors. 
C) increase demand for the product he or she produces. 
D) increase his marginal physical product. 
E) increase the availability of substitutes for the product he or she produces. 
A) increase the price of substitute factors. 
B) decrease the price of substitute factors. 
C) increase demand for the product he or she produces. 
D) increase his marginal physical product. 
E) increase the availability of substitutes for the product he or she produces.

Question 11

The general and likely purpose of a (labor)strike is to convince management that

Accepted Answer

A) the supply curve of labor is what the union says it is. 
B) the demand curve (for the product they sell)is what the union says it is. 
C) workers have a higher marginal physical product than the management think they (the workers)have. 
D) it is not in their best interest to raise the prices of the product they sell. 
A) the supply curve of labor is what the union says it is. 
B) the demand curve (for the product they sell)is what the union says it is. 
C) workers have a higher marginal physical product than the management think they (the workers)have. 
D) it is not in their best interest to raise the prices of the product they sell.

Question 12

Sometimes labor unions try to increase the demand for the product they produce. They do so because the demand for labor is derived; and the __________ the demand for the product labor produces, the __________labor and the __________ wages will be, ceteris paribus .

Accepted Answer

A) higher; greater the supply of; lower 
B) higher; lower the demand for; higher 
C) higher; higher the demand for; higher 
D) lower; higher the demand for; higher 
A) higher; greater the supply of; lower 
B) higher; lower the demand for; higher 
C) higher; higher the demand for; higher 
D) lower; higher the demand for; higher

Question 13

Exhibit 27-8 ​
 
Refer to Exhibit 27-8. In the absence of collective bargaining, what quantity of labor would the profit-maximizing monoposonist hire?

Accepted Answer

A) Q1 
B) Q2 
C) Q3 
D) Q4 
E) Q5 
A) Q1 
B) Q2 
C) Q3 
D) Q4 
E) Q5

Question 14

In the case of a monopsony, higher wage rates (over some range)do not necessarily imply fewer persons working.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following statements is true?

Accepted Answer

A) The lower the elasticity of demand for cars, the higher the elasticity of demand for the workers that produce cars. 
B) The higher the elasticity of demand for cars, the lower the elasticity of demand for the workers that produce cars. 
C) The lower the elasticity of demand for cars, the lower the elasticity of demand for the workers that produce cars. 
D) The fewer the substitute factors for union labor, the higher the elasticity of demand for union labor. 
A) The lower the elasticity of demand for cars, the higher the elasticity of demand for the workers that produce cars. 
B) The higher the elasticity of demand for cars, the lower the elasticity of demand for the workers that produce cars. 
C) The lower the elasticity of demand for cars, the lower the elasticity of demand for the workers that produce cars. 
D) The fewer the substitute factors for union labor, the higher the elasticity of demand for union labor.

Question 16

A profit-maximizing monopsonist will pay a wage rate that is less than the marginal factor cost.

Accepted Answer

A) True 
 B)False

Question 17

If a firm is a monopsonist, then it faces

Accepted Answer

A) a downward sloping demand curve for its product, and its marginal revenue curve will lie below its demand curve. 
B) a horizontal marginal factor cost curve. 
C) an upward sloping factor supply curve, and its marginal factor cost curve will lie above the factor supply curve. 
D) an upward sloping factor supply curve, and its marginal factor cost curve will coincide with the factor supply curve. 
E) an upward-sloping factor supply curve, and its marginal factor cost curve will lie below the factor supply curve. 
A) a downward sloping demand curve for its product, and its marginal revenue curve will lie below its demand curve. 
B) a horizontal marginal factor cost curve. 
C) an upward sloping factor supply curve, and its marginal factor cost curve will lie above the factor supply curve. 
D) an upward sloping factor supply curve, and its marginal factor cost curve will coincide with the factor supply curve. 
E) an upward-sloping factor supply curve, and its marginal factor cost curve will lie below the factor supply curve.

Question 18

Exhibit 27-3 ​
 
Refer to Exhibit 27-3. In the absence of collective bargaining, if the profit-maximizing monopsonist were to pay workers what their services were worth to it, it would pay

Accepted Answer

A) W1. 
B) W2. 
C) W3. 
D) some wage rate between W2 and W3. 
A) W1. 
B) W2. 
C) W3. 
D) some wage rate between W2 and W3.

Question 19

The traditional (or orthodox)view of labor unions is that they

Accepted Answer

A) positively impact productivity and efficiency. 
B) negatively impact productivity and efficiency. 
C) give workers a greater sense of job security. 
D) make all labor employed where it is the most valuable. 
A) positively impact productivity and efficiency. 
B) negatively impact productivity and efficiency. 
C) give workers a greater sense of job security. 
D) make all labor employed where it is the most valuable.

Question 20

Exhibit 27-8 ​
 
Refer to Exhibit 27-8. In the absence of collective bargaining, what wage rate would the profit-maximizing monoposonist pay?

Accepted Answer

A) W1 
B) W2 
C) W3 
D) W4 
E) W5 
A) W1 
B) W2 
C) W3 
D) W4 
E) W5

Exam 14: Wages, Union, and Labor

As long as there are advancements in technology, some workers will be temporarily displaced.

Exhibit 27-8 ​ Refer to Exhibit 27-8. If the monopsonist could perfectly discriminate by paying each worker a different wage rate, the number of workers employed would be

Unions are interested in increasing the productivity of their members because as their productivity rises, the __________ their labor __________ and their wages __________.

The lower the elasticity of demand is for labor, the greater will be the cutback in labor for any given wage increase.

Exhibit 27-7 ​ Refer to Exhibit 27-7. As the firm increases employment from 30 to 40 workers, its total labor cost

Exhibit 27-5 ​ Refer to Exhibit 27-5. In which of the following cases has the increase in the wage from W1 to W2 been brought about by a country-wide legalization of union shops?

A monopsonist's wage rate is

It is possible for an increase in minimum wage to increase the number of workers hired in a competitive labor market, but not in a monopsony setting.

Exhibit 27-12 Refer to Exhibit 27-12. The profit-maximizing number of workers to hire for this firm is

An American labor union worker has a picket sign that reads "Say No to Tokyo, Buy American." Most likely, the worker is trying to

The general and likely purpose of a (labor)strike is to convince management that

Sometimes labor unions try to increase the demand for the product they produce. They do so because the demand for labor is derived; and the __________ the demand for the product labor produces, the __________labor and the __________ wages will be, ceteris paribus .

Exhibit 27-8 ​ Refer to Exhibit 27-8. In the absence of collective bargaining, what quantity of labor would the profit-maximizing monoposonist hire?

In the case of a monopsony, higher wage rates (over some range)do not necessarily imply fewer persons working.

Which of the following statements is true?

A profit-maximizing monopsonist will pay a wage rate that is less than the marginal factor cost.

If a firm is a monopsonist, then it faces

Exhibit 27-3 ​ Refer to Exhibit 27-3. In the absence of collective bargaining, if the profit-maximizing monopsonist were to pay workers what their services were worth to it, it would pay

The traditional (or orthodox)view of labor unions is that they

Exhibit 27-8 ​ Refer to Exhibit 27-8. In the absence of collective bargaining, what wage rate would the profit-maximizing monoposonist pay?

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free, Controlled, and Relative

Supply, Demand, and Price: Applications

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, Oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

The Distribution of Income and Poverty

Interest, Rent, and Profit

Market Failure: Externalities, Public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

The Economic Case for and Against Government: Five Topics Considered

Stocks, Bonds, Futures, and Options

Filters

Exhibit 27-8 Refer to Exhibit 27-8. If the monopsonist could perfectly discriminate by paying each worker a different wage rate, the number of workers employed would be

Unions are interested in increasing the productivity of their members because as their productivity rises, the their labor and their wages __.

Exhibit 27-7 Refer to Exhibit 27-7. As the firm increases employment from 30 to 40 workers, its total labor cost

Exhibit 27-5 Refer to Exhibit 27-5. In which of the following cases has the increase in the wage from W₁ to W₂ been brought about by a country-wide legalization of union shops?

Sometimes labor unions try to increase the demand for the product they produce. They do so because the demand for labor is derived; and the the demand for the product labor produces, the labor and the __ wages will be, ceteris paribus .

Exhibit 27-8 Refer to Exhibit 27-8. In the absence of collective bargaining, what quantity of labor would the profit-maximizing monoposonist hire?

Exhibit 27-3 Refer to Exhibit 27-3. In the absence of collective bargaining, if the profit-maximizing monopsonist were to pay workers what their services were worth to it, it would pay

Exhibit 27-8 Refer to Exhibit 27-8. In the absence of collective bargaining, what wage rate would the profit-maximizing monoposonist pay?