Question 1

Unions typically argue that state right-to-work laws

Accepted Answer

A) are unfair. 
B) constrain unions' abilities to control the supply of labor in a market. 
C) are inconsistent with the Taft-Hartley Act. 
D) legalize union shops. 
A) are unfair. 
B) constrain unions' abilities to control the supply of labor in a market. 
C) are inconsistent with the Taft-Hartley Act. 
D) legalize union shops.

Question 2

A monopsony, as compared to a perfectly competitive firm, pays __________ wage and hires __________ labor.

Accepted Answer

A) a higher; less 
B) a higher; more 
C) a lower; less 
D) a lower; more 
E) the same; the same amount of 
A) a higher; less 
B) a higher; more 
C) a lower; less 
D) a lower; more 
E) the same; the same amount of

Question 3

Which of the following is not consistent with the view of labor unions as a collective voice?

Accepted Answer

A) Unions reduce job exiting. 
B) Labor productivity declines as a result of labor unions 
C) The worker turnover rate is reduced by labor unions. 
D) Workers feel more secure in their jobs as a result of labor unions. 
A) Unions reduce job exiting. 
B) Labor productivity declines as a result of labor unions 
C) The worker turnover rate is reduced by labor unions. 
D) Workers feel more secure in their jobs as a result of labor unions.

Question 4

A union shop is an organization that

Accepted Answer

A) requires individuals to join a union within a certain period of time after becoming employed. 
B) requires individuals to be members of the union before they can be hired. 
C) is legal in all fifty states. 
D) is set up by labor unions to train new entrants and inform members of jobs in different states. 
A) requires individuals to join a union within a certain period of time after becoming employed. 
B) requires individuals to be members of the union before they can be hired. 
C) is legal in all fifty states. 
D) is set up by labor unions to train new entrants and inform members of jobs in different states.

Question 5

Labor unions have caused

Accepted Answer

A) the fraction of national income that goes to labor (union and nonunion, combined)to increase. 
B) the fraction of national income that goes to labor (union and nonunion, combined)to decrease. 
C) almost no change in the fraction of national income that goes to labor (union and nonunion, combined). 
D) the fraction of national income that goes to profits to rise. 
A) the fraction of national income that goes to labor (union and nonunion, combined)to increase. 
B) the fraction of national income that goes to labor (union and nonunion, combined)to decrease. 
C) almost no change in the fraction of national income that goes to labor (union and nonunion, combined). 
D) the fraction of national income that goes to profits to rise.

Question 6

The marginal factor cost of labor for a monopsonist is

Accepted Answer

A) equal to the wage rate because if the monopsonist wants to hire another worker, it can do so at the old wage rate. 
B) less than the wage rate because if the monopsonist wants to hire another worker, it has to raise the wage rate paid to all workers. 
C) less than the wage rate because if the monopsonist wants to hire another worker, it has to lower the wage rate paid to all workers. 
D) greater than the wage rate because if the monopsonist wants to hire another worker, it has to raise the wage rate paid to all workers. 
A) equal to the wage rate because if the monopsonist wants to hire another worker, it can do so at the old wage rate. 
B) less than the wage rate because if the monopsonist wants to hire another worker, it has to raise the wage rate paid to all workers. 
C) less than the wage rate because if the monopsonist wants to hire another worker, it has to lower the wage rate paid to all workers. 
D) greater than the wage rate because if the monopsonist wants to hire another worker, it has to raise the wage rate paid to all workers.

Question 7

All economists assert that the National Collegiate Athletic Association (NCAA)is a type of cartel that enforces the monopsony behavior of universities and colleges in the market for college athletes.

Accepted Answer

A) True 
 B)False

Question 8

Exhibit 27-12   Refer to Exhibit 27-12. For each quantity of labor hired (after the first worker), marginal factor cost will be

Accepted Answer

A) less than the corresponding amount in column (2). 
B) greater than the corresponding amount in column (2). 
C) less than the corresponding amount in column (3). 
D) greater than the corresponding amount in column (3). 
A) less than the corresponding amount in column (2). 
B) greater than the corresponding amount in column (2). 
C) less than the corresponding amount in column (3). 
D) greater than the corresponding amount in column (3).

Question 9

Exhibit 27-8 ​
 
Refer to Exhibit 27-8. An effective price floor set at W3 would

Accepted Answer

A) increase employment from Q1 to Q2. 
B) increase employment from Q3 to Q4. 
C) decrease employment from Q5 to Q2. 
D) decrease employment from Q5 to Q4. 
A) increase employment from Q1 to Q2. 
B) increase employment from Q3 to Q4. 
C) decrease employment from Q5 to Q2. 
D) decrease employment from Q5 to Q4.

Question 10

Exhibit 27-8 ​
 
Refer to Exhibit 27-8. If the profit-maximizing monopsonist were to pay its workers what the marginal worker's services are worth to it, the wage rate would be

Accepted Answer

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

Question 11

If a monopsonist is hiring factors, it will choose to hire that quantity of labor at which __________ and pay a wage rate that is __________.

Accepted Answer

A) MR = MC; equal to labor's MRP 
B) the supply curve of labor intersects the demand curve for labor; equal to labor's MRP 
C) MRP = MFC; equal to labor's MRP 
D) MRP = MFC; less than labor's MRP 
E) the supply curve of labor intersects the demand curve for labor; less than MFC 
A) MR = MC; equal to labor's MRP 
B) the supply curve of labor intersects the demand curve for labor; equal to labor's MRP 
C) MRP = MFC; equal to labor's MRP 
D) MRP = MFC; less than labor's MRP 
E) the supply curve of labor intersects the demand curve for labor; less than MFC

Question 12

What is the difference between a union shop and a closed shop?  Are either (or both)legal in the United States?

Accepted Answer

A closed shop is an organization in whic

Question 13

Since workers today can move from city to city (quite easily)and from firm to firm (again, quite easily), it is unlikely that there are very many pure

Accepted Answer

A) monopsony firms. 
B) oligopoly firms. 
C) monopoly firms. 
D) perfectly competitive firms. 
E) factor price takers. 
A) monopsony firms. 
B) oligopoly firms. 
C) monopoly firms. 
D) perfectly competitive firms. 
E) factor price takers.

Question 14

A single buyer in a factor market is known as a

Accepted Answer

A) monopoly. 
B) monopsony. 
C) oligopsony. 
D) pure buyer. 
A) monopoly. 
B) monopsony. 
C) oligopsony. 
D) pure buyer.

Question 15

Which of the following is true for a monopsony?

Accepted Answer

A) It can buy additional units of a factor without increasing the price it pays for the factor. 
B) It can buy additional Units of a factor without increasing the price it pays for the factor. 
C) The supply of labor it faces is the industry supply of labor. 
D) The supply of labor curve lies above the firm's MFC curve. 
A) It can buy additional units of a factor without increasing the price it pays for the factor. 
B) It can buy additional Units of a factor without increasing the price it pays for the factor. 
C) The supply of labor it faces is the industry supply of labor. 
D) The supply of labor curve lies above the firm's MFC curve.

Question 16

A labor union undertakes a training program for its members. The objective of the training program is to

Accepted Answer

A) increase substitute factor prices. 
B) increase the marginal physical product of its members and therefore increase the demand for their services. 
C) reduce the availability of substitutes for the product it produces. 
D) lower the supply of its labor. 
A) increase substitute factor prices. 
B) increase the marginal physical product of its members and therefore increase the demand for their services. 
C) reduce the availability of substitutes for the product it produces. 
D) lower the supply of its labor.

Question 17

Exhibit 27-1 ​
 
Refer to Exhibit 27-l. Four demand curves for labor are displayed: D1, D2, D3, and D4. Which provides the most pronounced wage-employment tradeoff?

Accepted Answer

A) D1 
B) D2 
C) D3 
D) D4 
A) D1 
B) D2 
C) D3 
D) D4

Question 18

Exhibit 27-5 ​
 
Refer to Exhibit 27-5. In which case or cases does the increase in the wage rate from W1 to W2 definitely cause the total wage bill to rise?

Accepted Answer

A) (1) 
B) (2) 
C) (3) 
D) (1)and (2) 
E) (1)and (3) 
A) (1) 
B) (2) 
C) (3) 
D) (1)and (2) 
E) (1)and (3)

Question 19

The supply curve of labor that an employer faces can be changed through successful collective bargaining by a labor union.

Accepted Answer

A) True 
 B)False

Question 20

Exhibit 27-11 ​
 
Refer to Exhibit 27-11. The firm in the exhibit is a monopsony. We have deliberately not identified the three curves in the exhibit. They are simply curves 1, 2, and 3. If (union)collective bargaining with the monopsony guarantees the wage rate that workers will be paid is W2, then how many more workers will the monopsony hire than it would hire if it could pay its chosen (or preferred)wage?

Accepted Answer

A) Q4 - Q1 more workers 
B) Q3 - Q2 more workers 
C) Q2 - Q1 more workers 
D) Q3 - Q1 more workers 
E) Q4 - Q3 more workers 
A) Q4 - Q1 more workers 
B) Q3 - Q2 more workers 
C) Q2 - Q1 more workers 
D) Q3 - Q1 more workers 
E) Q4 - Q3 more workers

Exam 14: Wages, Union, and Labor

Unions typically argue that state right-to-work laws

A monopsony, as compared to a perfectly competitive firm, pays __________ wage and hires __________ labor.

Which of the following is not consistent with the view of labor unions as a collective voice?

A union shop is an organization that

Labor unions have caused

The marginal factor cost of labor for a monopsonist is

All economists assert that the National Collegiate Athletic Association (NCAA)is a type of cartel that enforces the monopsony behavior of universities and colleges in the market for college athletes.

Exhibit 27-12 Refer to Exhibit 27-12. For each quantity of labor hired (after the first worker), marginal factor cost will be

Exhibit 27-8 ​ Refer to Exhibit 27-8. An effective price floor set at W3 would

Exhibit 27-8 ​ Refer to Exhibit 27-8. If the profit-maximizing monopsonist were to pay its workers what the marginal worker's services are worth to it, the wage rate would be

If a monopsonist is hiring factors, it will choose to hire that quantity of labor at which __________ and pay a wage rate that is __________.

What is the difference between a union shop and a closed shop? Are either (or both)legal in the United States?

Since workers today can move from city to city (quite easily)and from firm to firm (again, quite easily), it is unlikely that there are very many pure

A single buyer in a factor market is known as a

Which of the following is true for a monopsony?

A labor union undertakes a training program for its members. The objective of the training program is to

Exhibit 27-1 ​ Refer to Exhibit 27-l. Four demand curves for labor are displayed: D1, D2, D3, and D4. Which provides the most pronounced wage-employment tradeoff?

Exhibit 27-5 ​ Refer to Exhibit 27-5. In which case or cases does the increase in the wage rate from W1 to W2 definitely cause the total wage bill to rise?

The supply curve of labor that an employer faces can be changed through successful collective bargaining by a labor union.

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

A monopsony, as compared to a perfectly competitive firm, pays wage and hires labor.

Exhibit 27-8 Refer to Exhibit 27-8. An effective price floor set at W₃ would

Exhibit 27-8 Refer to Exhibit 27-8. If the profit-maximizing monopsonist were to pay its workers what the marginal worker's services are worth to it, the wage rate would be

If a monopsonist is hiring factors, it will choose to hire that quantity of labor at which and pay a wage rate that is .

Exhibit 27-1 Refer to Exhibit 27-l. Four demand curves for labor are displayed: D₁, D₂, D₃, and D₄. Which provides the most pronounced wage-employment tradeoff?

Exhibit 27-5 Refer to Exhibit 27-5. In which case or cases does the increase in the wage rate from W₁ to W₂ definitely cause the total wage bill to rise?