Question 1

In their own best interest, labor unions generally oppose

Accepted Answer

A) import restrictions. 
B) strict immigration laws. 
C) increasing the minimum wage. 
D) relaxing immigration laws. 
A) import restrictions. 
B) strict immigration laws. 
C) increasing the minimum wage. 
D) relaxing immigration laws.

Question 2

In the United States, the percentage of national income that goes to labor (union plus nonunion)was higher when union membership was relatively high and unions were strong, compared to when union membership was relatively low.

Accepted Answer

A) True 
 B)False

Question 3

A closed shop is an organization

Accepted Answer

A) that is closed on holidays. 
B) in which an employee must belong to the union before he or she can work. 
C) that does not require workers to be union members in order to be hired, but does require them to join the union within a certain period of time after becoming employed. 
D) set up by the federal government to train ex-convicts to become productive workers. 
A) that is closed on holidays. 
B) in which an employee must belong to the union before he or she can work. 
C) that does not require workers to be union members in order to be hired, but does require them to join the union within a certain period of time after becoming employed. 
D) set up by the federal government to train ex-convicts to become productive workers.

Question 4

If, through collective bargaining, a union is able to raise the wage above the existing competitive equilibrium wage,

Accepted Answer

A) fewer workers will be employed than before the wage increase. 
B) more workers will be employed than before the wage increase. 
C) the same number of workers will be employed as before the wage increase. 
D) the number of workers that will be employed is not related to the wage increase. 
A) fewer workers will be employed than before the wage increase. 
B) more workers will be employed than before the wage increase. 
C) the same number of workers will be employed as before the wage increase. 
D) the number of workers that will be employed is not related to the wage increase.

Question 5

If a union seeks to maximize the total wage bill received by its members, then it

Accepted Answer

A) should seek to establish the highest possible wage rate. 
B) should seek to establish the lowest possible wage rate. 
C) will find that this cannot be done under any circumstances. 
D) should seek to establish the wage rate at the level where the price elasticity of demand for labor is equal to 1. 
A) should seek to establish the highest possible wage rate. 
B) should seek to establish the lowest possible wage rate. 
C) will find that this cannot be done under any circumstances. 
D) should seek to establish the wage rate at the level where the price elasticity of demand for labor is equal to 1.

Question 6

Exhibit 27-12   Refer to Exhibit 27-12. As the firm increases employment from 2 to 3 workers, its marginal factor cost (MFC)is

Accepted Answer

A) $24. 
B) $11. 
C) $33. 
D) $8. 
A) $24. 
B) $11. 
C) $33. 
D) $8.

Question 7

Labor unions tend to favor strictly enforced immigration laws with the intention of lowering the elasticity of demand for union labor.

Accepted Answer

A) True 
 B)False

Question 8

As evidenced by one of the exhibits in the textbook, union wages are ___________ higher than non-union wages in the same industry.

Accepted Answer

A) always 
B) sometimes 
C) rarely 
D) never 
A) always 
B) sometimes 
C) rarely 
D) never

Question 9

Suppose the marginal revenue product of individuals who work in the union sector is greater than that of individuals who work in the nonunion sector. Normally, we would expect labor to move from the nonunionized sector to the unionized sector-from where it is worth less to where it is worth more. But if this cannot happen, owing to the supply-restraining efforts of the union, then

Accepted Answer

A) wages in the nonunion sector will rise. 
B) wages in the union sector will fall. 
C) there will be a misallocation of labor---not all labor will be employed where it is most valuable. 
D) workers in the union sector will move to the nonunion sector. 
A) wages in the nonunion sector will rise. 
B) wages in the union sector will fall. 
C) there will be a misallocation of labor---not all labor will be employed where it is most valuable. 
D) workers in the union sector will move to the nonunion sector.

Question 10

For a union to be successful in increasing the total wage bill received by its members by forcing up the wage rate, the demand curve for labor needs to be

Accepted Answer

A) elastic. 
B) perfectly elastic. 
C) unitary elastic. 
D) inelastic. 
A) elastic. 
B) perfectly elastic. 
C) unitary elastic. 
D) inelastic.

Question 11

The traditional view of labor unions is that they enhance worker productivity because the workers feel more secure in their jobs and because there is a low turnover rate in union firms.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following statements is true?

Accepted Answer

A) The union-as-collective-voice view of the labor union holds that labor unions have a negative impact on productivity and efficiency. 
B) The traditional view of the labor union is that the union acts as a collective voice for workers and probably leads to lower quit rates (among employees). 
C) The union-as-collective-voice view of the labor union holds that labor unions often have unnecessary staffing requirements, which means that they insist that only certain persons be allowed to do certain jobs. 
D) The union-as-collective-voice view of the labor union holds that labor unions have a positive impact on productivity and efficiency. 
A) The union-as-collective-voice view of the labor union holds that labor unions have a negative impact on productivity and efficiency. 
B) The traditional view of the labor union is that the union acts as a collective voice for workers and probably leads to lower quit rates (among employees). 
C) The union-as-collective-voice view of the labor union holds that labor unions often have unnecessary staffing requirements, which means that they insist that only certain persons be allowed to do certain jobs. 
D) The union-as-collective-voice view of the labor union holds that labor unions have a positive impact on productivity and efficiency.

Question 13

The lower the elasticity of demand for labor,

Accepted Answer

A) the larger the cutback in labor for a given wage increase. 
B) the smaller the cutback in labor for a given wage increase. 
C) the higher the wage rate that a labor union receives for its membership. 
D) the lower the wage rate that a labor union receives for its membership. 
E) the more members of a given union. 
A) the larger the cutback in labor for a given wage increase. 
B) the smaller the cutback in labor for a given wage increase. 
C) the higher the wage rate that a labor union receives for its membership. 
D) the lower the wage rate that a labor union receives for its membership. 
E) the more members of a given union.

Question 14

Exhibit 27-4 ​
 
Refer to Exhibit 27-4. If a labor union successfully organizes the labor market and sets the wage rate at W4, the quantity of labor hired will be

Accepted Answer

A) Q1. 
B) Q2. 
C) Q3. 
D) Q4. 
E) cannot be determined 
A) Q1. 
B) Q2. 
C) Q3. 
D) Q4. 
E) cannot be determined

Question 15

Union training programs are meant to shift the __________ labor to the __________.

Accepted Answer

A) demand curve for; left 
B) demand curve for; right 
C) supply curve of; left 
D) supply curve of; right 
A) demand curve for; left 
B) demand curve for; right 
C) supply curve of; left 
D) supply curve of; right

Question 16

Exhibit 27-2 ​
 
Refer to Exhibit 27-2. One of the things that the labor union probably can do to convince management that the supply curve is S'S instead of SS is

Accepted Answer

A) make a credible threat of a strike. 
B) ask workers to take a cut in fringe benefits. 
C) try to maximize the wage bill to the union. 
D) try to maximize membership in the union. 
A) make a credible threat of a strike. 
B) ask workers to take a cut in fringe benefits. 
C) try to maximize the wage bill to the union. 
D) try to maximize membership in the union.

Question 17

In your textbook there is an exhibit that shows (for selected industries)the median weekly earnings of workers represented by labor unions and the median weekly earnings of workers not represented by labor unions. The point to be made by this comparison is that in some cases,

Accepted Answer

A) nonunion workers earn more than union workers (which is different from what most people expect). 
B) nonunion workers and union workers earn the same. 
C) union workers earn always more than nonunion workers. 
D) the number of union workers is greater than the number of nonunion workers. 
A) nonunion workers earn more than union workers (which is different from what most people expect). 
B) nonunion workers and union workers earn the same. 
C) union workers earn always more than nonunion workers. 
D) the number of union workers is greater than the number of nonunion workers.

Question 18

When firm A hires one worker it pays $10 an hour and its total labor cost is $10. When it hires a second worker, it has to pay $11 to each of its two workers and its total labor cost is $22. When it hires a third worker, it has to pay $12 to each of its three workers and its total labor cost is $36. For firm A,

Accepted Answer

A) its marginal factor cost is greater than the wage rate it pays, except for the first worker it hires. 
B) its marginal factor cost is greater than the wage rate it pays, except for the first two workers it hires. 
C) its supply curve of labor lies above its marginal factor cost curve. 
D) it is likely that marginal revenue product is always greater than marginal factor cost. 
A) its marginal factor cost is greater than the wage rate it pays, except for the first worker it hires. 
B) its marginal factor cost is greater than the wage rate it pays, except for the first two workers it hires. 
C) its supply curve of labor lies above its marginal factor cost curve. 
D) it is likely that marginal revenue product is always greater than marginal factor cost.

Question 19

Assuming the wage-employment tradeoff exists, if labor in a particular geographic area is homogeneous and the unionized workers successfully negotiate a higher wage rate, then

Accepted Answer

A) nonunion workers will also experience an increase in their wages. 
B) nonunion workers will not be affected by what happens in the unionized labor market. 
C) the nonunion labor market will experience an increase in the number of workers, and this will cause wage rates to decrease in this market. 
D) nonunion workers will become members of the union that has just negotiated a wage increase because they want higher wages. 
A) nonunion workers will also experience an increase in their wages. 
B) nonunion workers will not be affected by what happens in the unionized labor market. 
C) the nonunion labor market will experience an increase in the number of workers, and this will cause wage rates to decrease in this market. 
D) nonunion workers will become members of the union that has just negotiated a wage increase because they want higher wages.

Question 20

Which of the following statements is true?

Accepted Answer

A) The traditional view of labor unions predicts that unionization of a firm will result in improvements in productivity and efficiency. 
B) The labor union as a collective voice view of labor unions predicts that unionization of a firm will result in decreases in productivity and efficiency. 
C) The traditional view of labor unions supports the formation of unions as a counterweight to firms' factor-hiring power. 
D) The labor union as a collective voice view of labor unions supports efforts to decrease the unions' role as a "monopolizer of labor." 
E) The traditional view of labor unions predicts that unionization of a firm will result in declines in productivity and efficiency. 
A) The traditional view of labor unions predicts that unionization of a firm will result in improvements in productivity and efficiency. 
B) The labor union as a collective voice view of labor unions predicts that unionization of a firm will result in decreases in productivity and efficiency. 
C) The traditional view of labor unions supports the formation of unions as a counterweight to firms' factor-hiring power. 
D) The labor union as a collective voice view of labor unions supports efforts to decrease the unions' role as a "monopolizer of labor." 
E) The traditional view of labor unions predicts that unionization of a firm will result in declines in productivity and efficiency.

Exam 14: Wages, Union, and Labor

In their own best interest, labor unions generally oppose

In the United States, the percentage of national income that goes to labor (union plus nonunion)was higher when union membership was relatively high and unions were strong, compared to when union membership was relatively low.

A closed shop is an organization

If, through collective bargaining, a union is able to raise the wage above the existing competitive equilibrium wage,

If a union seeks to maximize the total wage bill received by its members, then it

Exhibit 27-12 Refer to Exhibit 27-12. As the firm increases employment from 2 to 3 workers, its marginal factor cost (MFC)is

Labor unions tend to favor strictly enforced immigration laws with the intention of lowering the elasticity of demand for union labor.

As evidenced by one of the exhibits in the textbook, union wages are ___________ higher than non-union wages in the same industry.

For a union to be successful in increasing the total wage bill received by its members by forcing up the wage rate, the demand curve for labor needs to be

The traditional view of labor unions is that they enhance worker productivity because the workers feel more secure in their jobs and because there is a low turnover rate in union firms.

Which of the following statements is true?

The lower the elasticity of demand for labor,

Exhibit 27-4 ​ Refer to Exhibit 27-4. If a labor union successfully organizes the labor market and sets the wage rate at W4, the quantity of labor hired will be

Union training programs are meant to shift the __________ labor to the __________.

Exhibit 27-2 ​ Refer to Exhibit 27-2. One of the things that the labor union probably can do to convince management that the supply curve is S'S instead of SS is

In your textbook there is an exhibit that shows (for selected industries)the median weekly earnings of workers represented by labor unions and the median weekly earnings of workers not represented by labor unions. The point to be made by this comparison is that in some cases,

Assuming the wage-employment tradeoff exists, if labor in a particular geographic area is homogeneous and the unionized workers successfully negotiate a higher wage rate, then

Which of the following statements is true?

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 27-4 Refer to Exhibit 27-4. If a labor union successfully organizes the labor market and sets the wage rate at W₄, the quantity of labor hired will be

Union training programs are meant to shift the labor to the .

Exhibit 27-2 Refer to Exhibit 27-2. One of the things that the labor union probably can do to convince management that the supply curve is S'S instead of SS is