Question 1

In the labor market, firms demand labor and households supply labor.

Accepted Answer

A) True 
 B)False

Question 2

Union members typically earn _____ wages than nonunion members in the same industry while also experiencing _____ wage inequities due to its bargaining power with employers.

Accepted Answer

A)  higher; higher 
B)  higher; lower 
C)  lower; higher 
D)  lower; lower 
A)  higher; higher 
B)  higher; lower 
C)  lower; higher 
D)  lower; lower

Question 3

For a competitive industry

Accepted Answer

A)  VMP = MRP. 
B)  MRP is less than VMP. 
C)  MRP is greater than VMP. 
D)  VMP is always negative. 
A)  VMP = MRP. 
B)  MRP is less than VMP. 
C)  MRP is greater than VMP. 
D)  VMP is always negative.

Question 4

Janice has just graduated from college and is seeking her first job. If she cannot find a job that pays at least $40,000 per year, she will instead travel to Africa to volunteer for a wildlife conservation organization. For Janice, $40,000 is her _____ wage.

Accepted Answer

A)  marginal 
B)  opportunity 
C)  reservation 
D)  efficiency 
A)  marginal 
B)  opportunity 
C)  reservation 
D)  efficiency

Question 5

Which factor will NOT shift the labor supply curve to the left?

Accepted Answer

A)  mandatory school attendance to the age of 23 
B)  mandatory retirement at the age of 59 
C)  religious rules against working on Wednesdays and Thursdays 
D)  a new miracle drug that increases longevity 
A)  mandatory school attendance to the age of 23 
B)  mandatory retirement at the age of 59 
C)  religious rules against working on Wednesdays and Thursdays 
D)  a new miracle drug that increases longevity

Question 6

In a competitive labor market, one employee is considered a substitute for another employee.

Accepted Answer

A) True 
 B)False

Question 7

The "income effect" for labor supply states that people work more as wages rise because the opportunity cost of leisure falls.

Accepted Answer

A) True 
 B)False

Question 8

The future of jobs in the United States can be described in all these ways EXCEPT

Accepted Answer

A)  future jobs will require increasingly higher levels of education and training. 
B)  jobs will offer new workers generous pension plans. 
C)  growing professions include renewable energy specialists, telecommunications technicians, and internet security investigators. 
D)  over the next 10 years, health care and scientific services are among the industries expected to generate the most new jobs. 
A)  future jobs will require increasingly higher levels of education and training. 
B)  jobs will offer new workers generous pension plans. 
C)  growing professions include renewable energy specialists, telecommunications technicians, and internet security investigators. 
D)  over the next 10 years, health care and scientific services are among the industries expected to generate the most new jobs.

Question 9

If Tamara is given a $3-per-hour pay increase, and in response, she decides to work more hours, then

Accepted Answer

A)  Tamara's work hours are represented on the upward-sloping portion of her labor supply curve. 
B)  Tamara's work hours are represented on the downward-sloping portion of her labor supply curve. 
C)  the income effect is dominating the substitution effect. 
D)  Tamara's labor supply curve is flat. 
A)  Tamara's work hours are represented on the upward-sloping portion of her labor supply curve. 
B)  Tamara's work hours are represented on the downward-sloping portion of her labor supply curve. 
C)  the income effect is dominating the substitution effect. 
D)  Tamara's labor supply curve is flat.

Question 10

(Figure: Market Wages and Labor Demand) Based on the figure, if the market wage is $60, the firm will employ _____ workers.

Accepted Answer

A)  four 
B)  six 
C)  seven 
D)  eight 
A)  four 
B)  six 
C)  seven 
D)  eight

Question 11

If ten workers are each paid $9 an hour, but hiring the eleventh worker requires that all workers be paid $10 an hour, by how much does the total wage bill change once this worker is hired?

Accepted Answer

A)  $1 
B)  $19 
C)  $20 
D)  $30 
A)  $1 
B)  $19 
C)  $20 
D)  $30

Question 12

You are willing to work 30 hours per week at your standard wage rate. You would be willing to work an extra 10 hours each week if you could get an additional $5 per hour. This information reflects your

Accepted Answer

A)  marginal propensity to work. 
B)  demand for labor. 
C)  demand curve. 
D)  supply of labor. 
A)  marginal propensity to work. 
B)  demand for labor. 
C)  demand curve. 
D)  supply of labor.

Question 13

The act that makes it unlawful to refuse to hire a person based on his or her race, color, religion, sex, or national origin is the

Accepted Answer

A)  Equal Pay Act of 1963. 
B)  Smoot-Hawley Tariff Act. 
C)  Civil Rights Act of 1964. 
D)  Affirmative Action Act. 
A)  Equal Pay Act of 1963. 
B)  Smoot-Hawley Tariff Act. 
C)  Civil Rights Act of 1964. 
D)  Affirmative Action Act.

Question 14

In competitive labor markets, we assume that

Accepted Answer

A)  firms operate in markets with many sellers and few buyers. 
B)  workers have differentiated skills. 
C)  firms operate in markets with few sellers and many buyers. 
D)  information in the industry is widely available and accurate. 
A)  firms operate in markets with many sellers and few buyers. 
B)  workers have differentiated skills. 
C)  firms operate in markets with few sellers and many buyers. 
D)  information in the industry is widely available and accurate.

Question 15

If wages increase at a 5% rate and the quantity demanded of labor decreases by 10%, then the elasticity of demand for labor is

Accepted Answer

A)  50. 
B)  0.5. 
C)  2. 
D)  10. 
A)  50. 
B)  0.5. 
C)  2. 
D)  10.

Question 16

The cost of sending a space shuttle into orbit is $4 billion. The total cost of the astronaut's salary is $300,000 per year. The demand curve for astronauts will most likely be

Accepted Answer

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

Question 17

(Table) Based on the table, what must be TRUE about the labor supply curve for wage rates up to $45 per hour?
$\begin{array}{c}
\text { Labor Supply Schedule }\
\begin{array}{|c|c|}
\hline \text { Wage rate (\$/hr.) } & \text { Hours of work (per week) } \
\hline 10 & 26 \
\hline 15 & 32 \
\hline 25 & 36 \
\hline 35 & 40 \
\hline 45 & 41 \
\hline 50 & 38 \
\hline
\end{array}
\end{array}$

Accepted Answer

A)  As the wage rate rises, more hours of leisure are consumed. 
B)  The income effect dominates the substitution effect. 
C)  The substitution effect dominates the income effect. 
D)  As the wage rate rises, hours of work decrease. 
A)  As the wage rate rises, more hours of leisure are consumed. 
B)  The income effect dominates the substitution effect. 
C)  The substitution effect dominates the income effect. 
D)  As the wage rate rises, hours of work decrease.

Question 18

The _____ shows the amount of time an individual is willing to work at various wage rates.

Accepted Answer

A)  labor supply curve 
B)  labor demand curve 
C)  supply of jobs 
D)  labor survey 
A)  labor supply curve 
B)  labor demand curve 
C)  supply of jobs 
D)  labor survey

Question 19

The greater the elasticity of demand for labor, the

Accepted Answer

A)  greater the price elasticity of demand for the final product. 
B)  smaller the proportion of wage costs in the total cost of production. 
C)  shorter the time period under examination. 
D)  more difficult it is to employ substitute inputs in production. 
A)  greater the price elasticity of demand for the final product. 
B)  smaller the proportion of wage costs in the total cost of production. 
C)  shorter the time period under examination. 
D)  more difficult it is to employ substitute inputs in production.

Question 20

Which theory of economic discrimination states that labor markets are split into a high-wage primary sector and a low-wage secondary sector?

Accepted Answer

A)  insider-outsider theory 
B)  Becker's theory of discrimination 
C)  job crowding hypothesis 
D)  dual labor market hypothesis 
A)  insider-outsider theory 
B)  Becker's theory of discrimination 
C)  job crowding hypothesis 
D)  dual labor market hypothesis

In the labor market, firms demand labor and households supply labor.

Union members typically earn _ wages than nonunion members in the same industry while also experiencing _ wage inequities due to its bargaining power with employers.

For a competitive industry

Janice has just graduated from college and is seeking her first job. If she cannot find a job that pays at least $40,000 per year, she will instead travel to Africa to volunteer for a wildlife conservation organization. For Janice, $40,000 is her _____ wage.

Which factor will NOT shift the labor supply curve to the left?

In a competitive labor market, one employee is considered a substitute for another employee.

The "income effect" for labor supply states that people work more as wages rise because the opportunity cost of leisure falls.

The future of jobs in the United States can be described in all these ways EXCEPT

If Tamara is given a $3-per-hour pay increase, and in response, she decides to work more hours, then

(Figure: Market Wages and Labor Demand) Based on the figure, if the market wage is $60, the firm will employ _____ workers.

If ten workers are each paid $9 an hour, but hiring the eleventh worker requires that all workers be paid $10 an hour, by how much does the total wage bill change once this worker is hired?

You are willing to work 30 hours per week at your standard wage rate. You would be willing to work an extra 10 hours each week if you could get an additional $5 per hour. This information reflects your

The act that makes it unlawful to refuse to hire a person based on his or her race, color, religion, sex, or national origin is the

In competitive labor markets, we assume that

If wages increase at a 5% rate and the quantity demanded of labor decreases by 10%, then the elasticity of demand for labor is

The cost of sending a space shuttle into orbit is $4 billion. The total cost of the astronaut's salary is $300,000 per year. The demand curve for astronauts will most likely be

(Table) Based on the table, what must be TRUE about the labor supply curve for wage rates up to $45 per hour? Labor Supply Schedule Wage rate ( \/ hr.) Hours of work (per week) 10 26 15 32 25 36 35 40 45 41 50 38

The _____ shows the amount of time an individual is willing to work at various wage rates.

The greater the elasticity of demand for labor, the

Which theory of economic discrimination states that labor markets are split into a high-wage primary sector and a low-wage secondary sector?

Exploring Economics

Production, Economic Growth, and Trade

Supply and Demand

Markets and Government

Elasticity

Consumer Choice and Demand

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, Oligopoly, and Game Theory

Land, Capital Markets, and Innovation

Externalities and Public Goods

Network Goods

Poverty and Income Distribution

International Trade

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Exam 11: The Labor Market

In the labor market, firms demand labor and households supply labor.

Union members typically earn _____ wages than nonunion members in the same industry while also experiencing _____ wage inequities due to its bargaining power with employers.

For a competitive industry

Janice has just graduated from college and is seeking her first job. If she cannot find a job that pays at least $40,000 per year, she will instead travel to Africa to volunteer for a wildlife conservation organization. For Janice, $40,000 is her _____ wage.

Which factor will NOT shift the labor supply curve to the left?

In a competitive labor market, one employee is considered a substitute for another employee.

The "income effect" for labor supply states that people work more as wages rise because the opportunity cost of leisure falls.

The future of jobs in the United States can be described in all these ways EXCEPT

If Tamara is given a $3-per-hour pay increase, and in response, she decides to work more hours, then

(Figure: Market Wages and Labor Demand) Based on the figure, if the market wage is $60, the firm will employ _____ workers.

If ten workers are each paid $9 an hour, but hiring the eleventh worker requires that all workers be paid $10 an hour, by how much does the total wage bill change once this worker is hired?

You are willing to work 30 hours per week at your standard wage rate. You would be willing to work an extra 10 hours each week if you could get an additional $5 per hour. This information reflects your

The act that makes it unlawful to refuse to hire a person based on his or her race, color, religion, sex, or national origin is the

In competitive labor markets, we assume that

If wages increase at a 5% rate and the quantity demanded of labor decreases by 10%, then the elasticity of demand for labor is

The cost of sending a space shuttle into orbit is $4 billion. The total cost of the astronaut's salary is $300,000 per year. The demand curve for astronauts will most likely be

(Table) Based on the table, what must be TRUE about the labor supply curve for wage rates up to $45 per hour? Labor Supply Schedule Wage rate ( \/ hr.) Hours of work (per week) 10 26 15 32 25 36 35 40 45 41 50 38

The _____ shows the amount of time an individual is willing to work at various wage rates.

The greater the elasticity of demand for labor, the

Which theory of economic discrimination states that labor markets are split into a high-wage primary sector and a low-wage secondary sector?

Exploring Economics

Production, Economic Growth, and Trade

Supply and Demand

Markets and Government

Elasticity

Consumer Choice and Demand

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, Oligopoly, and Game Theory

Land, Capital Markets, and Innovation

Externalities and Public Goods

Network Goods

Poverty and Income Distribution

International Trade

Filters

Union members typically earn _ wages than nonunion members in the same industry while also experiencing _ wage inequities due to its bargaining power with employers.