Question 1

Which of the following will be a long run impact of a pay-as-you-go Social Security program?

Accepted Answer

A) A shortage in the labor market 
B) A sluggish growth in the capital stock of the economy 
C) An increase in the gross domestic product 
D) An increase in the average wage rate 
A) A shortage in the labor market 
B) A sluggish growth in the capital stock of the economy 
C) An increase in the gross domestic product 
D) An increase in the average wage rate

Question 2

The Social Security system affects the demand curve for labor because:

Accepted Answer

A) it lowers savings which translates to a lower capital stock. 
B) it promotes capital accumulation. 
C) it increases the productivity of the workers. 
D) it increases overall investment in a nation. 
A) it lowers savings which translates to a lower capital stock. 
B) it promotes capital accumulation. 
C) it increases the productivity of the workers. 
D) it increases overall investment in a nation.

Question 3

When the supply curve of labor is perfectly inelastic and a social security tax is collected partly from employers and partly from employees,the burden of the tax is:

Accepted Answer

A) entirely borne by the employees. 
B) entirely borne by the employers. 
C) borne by both the employers and the employees. 
D) borne by the employers only if labor demand is elastic. 
A) entirely borne by the employees. 
B) entirely borne by the employers. 
C) borne by both the employers and the employees. 
D) borne by the employers only if labor demand is elastic.

Question 4

Suppose in the absence of a tax a firm employs 50 skilled workers at a wage rate of $20 per labor hour.If the supply of labor is perfectly inelastic,what will be the impact of a $2.50 per hour tax on the net wage received by the workers and total employment?

Accepted Answer

A) The net wage received by workers will be $17.50 per labor hour but total employment will not change. 
B) The net wage received by workers will be $15 per labor hour and total employment will reduce to 25 workers. 
C) The net wage received by workers will be $1750 per labor hour and total employment will reduce to 45 workers. 
D) The net wage received by workers will be $15 per labor hour and total employment will increase to 75 workers. 
A) The net wage received by workers will be $17.50 per labor hour but total employment will not change. 
B) The net wage received by workers will be $15 per labor hour and total employment will reduce to 25 workers. 
C) The net wage received by workers will be $1750 per labor hour and total employment will reduce to 45 workers. 
D) The net wage received by workers will be $15 per labor hour and total employment will increase to 75 workers.

Question 5

According to the U.S.Congressional Budget Office,immigrants in the United States:

Accepted Answer

A) are wealthier on average than current residents. 
B) are more productive on average than current residents. 
C) are less educated on average than current residents. 
D) are more skilled and experienced on average than current residents. 
A) are wealthier on average than current residents. 
B) are more productive on average than current residents. 
C) are less educated on average than current residents. 
D) are more skilled and experienced on average than current residents.

Question 6

Suppose the firms in a competitive industry form a cartel to reduce the price of one of the inputs they purchase.Which of the following will result from this collusive behavior?

Accepted Answer

A) The firms will employ fewer units of the input whose price they want to reduce. 
B) The firms will substitute other inputs for the input whose price they want to reduce. 
C) The price of the firms' final product will increase. 
D) The firms will be able to earn lower profits. 
A) The firms will employ fewer units of the input whose price they want to reduce. 
B) The firms will substitute other inputs for the input whose price they want to reduce. 
C) The price of the firms' final product will increase. 
D) The firms will be able to earn lower profits.

Question 7

Identify some of the reasons due to which wage rates may differ among individuals even in the absence of gender or racial discrimination.

Accepted Answer

Average wage rates of groups can differ

Question 8

When the supply curve of labor is perfectly inelastic the burden of a social security tax is:

Accepted Answer

A) borne partly by the employers and partly by employees. 
B) borne partly by the employers only if the demand for labor is elastic. 
C) entirely borne by the employees. 
D) entirely borne by the employers. 
A) borne partly by the employers and partly by employees. 
B) borne partly by the employers only if the demand for labor is elastic. 
C) entirely borne by the employees. 
D) entirely borne by the employers.

Question 9

Which of the following is not a predictable result of a refusal by a small number of employers to hire African Americans?

Accepted Answer

A) The wage rates of African Americans falls below those for whites 
B) Non-discriminating firms hire larger proportions of African Americans 
C) Segregated employment patterns will emerge 
D) Non-discriminating firms hire smaller proportions of whites 
A) The wage rates of African Americans falls below those for whites 
B) Non-discriminating firms hire larger proportions of African Americans 
C) Segregated employment patterns will emerge 
D) Non-discriminating firms hire smaller proportions of whites

Question 10

Provide a self-interested explanation for why labor unions spend a lot of time and money lobbying for increases in minimum wage mandates and for legislated "living wage" ordinances even though their members earn far more than the proposed wages.

Accepted Answer

Suppose an excavator can hire a high ski

Question 11

An aggregate labor supply curve is likely to be vertical if:

Accepted Answer

A) there is a fixed supply of labor. 
B) the opportunity cost of labor service is high. 
C) the substitution effect of a wage increase exactly offsets the income effect. 
D) leisure is a normal good. 
A) there is a fixed supply of labor. 
B) the opportunity cost of labor service is high. 
C) the substitution effect of a wage increase exactly offsets the income effect. 
D) leisure is a normal good.

Question 12

Explain graphically that a payroll tax imposed by the government either on the employers or on the employees will have a similar impact.

Accepted Answer

In the figure given below,the supply and

Question 13

Which of the following defines an efficiency wage?

Accepted Answer

A) It is the equilibrium wage rate in the labor market where the demand for labor exactly matches the supply of labor. 
B) It is an above-market wage which increases the firms' profits by increasing the productivity of all factors of production. 
C) It is an above-market wage which increases the firms' profits by lowering the costs of searching for,selecting,and training new workers. 
D) It is a below-market wage which increases the employment opportunities in an economy and reduces overall poverty. 
A) It is the equilibrium wage rate in the labor market where the demand for labor exactly matches the supply of labor. 
B) It is an above-market wage which increases the firms' profits by increasing the productivity of all factors of production. 
C) It is an above-market wage which increases the firms' profits by lowering the costs of searching for,selecting,and training new workers. 
D) It is a below-market wage which increases the employment opportunities in an economy and reduces overall poverty.

Question 14

A change in the social security system which required employers to pay the full amount of the social security tax rather than the 50 percent they now pay would:

Accepted Answer

A) force the employers to bear the entire tax burden. 
B) reduce the burden of the tax on the employees but not eliminate the burden completely. 
C) have no effect on the portion of the tax borne by the employees and the portion borne by the employers. 
D) increase the burden of the tax on the employees. 
A) force the employers to bear the entire tax burden. 
B) reduce the burden of the tax on the employees but not eliminate the burden completely. 
C) have no effect on the portion of the tax borne by the employees and the portion borne by the employers. 
D) increase the burden of the tax on the employees.

Question 15

Explain how you would investigate whether wage differences are due to discrimination.

Accepted Answer

To determine whether wage differences ar

Question 16

Employers sometimes reduce the fringe benefits provided to workers when the government sets a minimum wage in the labor market.Due to this:

Accepted Answer

A) the real wage that employers pay increases by more than the money wage. 
B) the real wage that employers pay declines and is at times zero. 
C) the real wage that employers pay increases at the same rate as the money wage. 
D) the real wage that employers pay increases by less than the money wage. 
A) the real wage that employers pay increases by more than the money wage. 
B) the real wage that employers pay declines and is at times zero. 
C) the real wage that employers pay increases at the same rate as the money wage. 
D) the real wage that employers pay increases by less than the money wage.

Question 17

The disemployment effect of the minimum wage refers to the tendency of employers to:

Accepted Answer

A) hire experienced workers at higher wages. 
B) hire fewer workers at higher wages. 
C) pay lower wages to skilled workers. 
D) hire more workers at a lower wage. 
A) hire experienced workers at higher wages. 
B) hire fewer workers at higher wages. 
C) pay lower wages to skilled workers. 
D) hire more workers at a lower wage.

Question 18

Discrimination might exist in a labor market at times,but it is not likely to last in the long run because:

Accepted Answer

A) the supply of labor is perfectly inelastic. 
B) costs are imposed on discriminators,which reduces their profits. 
C) discrimination is easy to define,allowing effective remedies do eliminate it. 
D) government intervention increases the cost borne by the discriminators. 
A) the supply of labor is perfectly inelastic. 
B) costs are imposed on discriminators,which reduces their profits. 
C) discrimination is easy to define,allowing effective remedies do eliminate it. 
D) government intervention increases the cost borne by the discriminators.

Question 19

The National Collegiate Athletic Association [NCAA] is a private organization empowered to regulate various aspects of college athletics.If this organization is somehow unable to prohibit schools that violate its rules from participating in postseason tournaments,we can expect:

Accepted Answer

A) less number of student athletes to receive scholarships. 
B) the student-athletes to be paid far more than they are worth to their colleges. 
C) the schools that abide by the rules to find their athletic programs more profitable. 
D) fewer violations of the NCAA rules to occur. 
A) less number of student athletes to receive scholarships. 
B) the student-athletes to be paid far more than they are worth to their colleges. 
C) the schools that abide by the rules to find their athletic programs more profitable. 
D) fewer violations of the NCAA rules to occur.

Question 20

An employer's cartel will seek to:

Accepted Answer

A) restrict the employment of the input and lower its price below its marginal revenue product. 
B) restrict the employment of the input and raise its price to the marginal factor cost. 
C) decrease the price of the input by employing more units of the input. 
D) restrict the employment of the input and increase its productivity. 
A) restrict the employment of the input and lower its price below its marginal revenue product. 
B) restrict the employment of the input and raise its price to the marginal factor cost. 
C) decrease the price of the input by employing more units of the input. 
D) restrict the employment of the input and increase its productivity.

Which of the following will be a long run impact of a pay-as-you-go Social Security program?

The Social Security system affects the demand curve for labor because:

When the supply curve of labor is perfectly inelastic and a social security tax is collected partly from employers and partly from employees,the burden of the tax is:

Suppose in the absence of a tax a firm employs 50 skilled workers at a wage rate of $20 per labor hour.If the supply of labor is perfectly inelastic,what will be the impact of a $2.50 per hour tax on the net wage received by the workers and total employment?

According to the U.S.Congressional Budget Office,immigrants in the United States:

Suppose the firms in a competitive industry form a cartel to reduce the price of one of the inputs they purchase.Which of the following will result from this collusive behavior?

Identify some of the reasons due to which wage rates may differ among individuals even in the absence of gender or racial discrimination.

When the supply curve of labor is perfectly inelastic the burden of a social security tax is:

Which of the following is not a predictable result of a refusal by a small number of employers to hire African Americans?

Provide a self-interested explanation for why labor unions spend a lot of time and money lobbying for increases in minimum wage mandates and for legislated "living wage" ordinances even though their members earn far more than the proposed wages.

An aggregate labor supply curve is likely to be vertical if:

Explain graphically that a payroll tax imposed by the government either on the employers or on the employees will have a similar impact.

Which of the following defines an efficiency wage?

A change in the social security system which required employers to pay the full amount of the social security tax rather than the 50 percent they now pay would:

Explain how you would investigate whether wage differences are due to discrimination.

Employers sometimes reduce the fringe benefits provided to workers when the government sets a minimum wage in the labor market.Due to this:

The disemployment effect of the minimum wage refers to the tendency of employers to:

Discrimination might exist in a labor market at times,but it is not likely to last in the long run because:

The National Collegiate Athletic Association [NCAA] is a private organization empowered to regulate various aspects of college athletics.If this organization is somehow unable to prohibit schools that violate its rules from participating in postseason tournaments,we can expect:

An employer's cartel will seek to:

An Introduction to Microeconomics

Supply and Demand

The Theory of Consumer Choice

Individual and Market Demand

Using Consumer Choice Theory

Exchange, Efficiency, and Prices

Production

The Cost of Production

Profit Maximization in Perfectly Competitive Markets

Using the Competitive Model

Monopoly

Product Pricing With Monopoly Power

Monopolistic Competition and Oligopoly

Game Theory and the Economics of Information

Using Noncompetitive Market Models

Employment and Pricing of Inputs

Wages, Rent, Interest, and Profit

General Equilibrium Analysis and Economic Efficiency

Public Goods and Externalities

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Exam 18: Using Input Market Analysis

Which of the following will be a long run impact of a pay-as-you-go Social Security program?

The Social Security system affects the demand curve for labor because:

When the supply curve of labor is perfectly inelastic and a social security tax is collected partly from employers and partly from employees,the burden of the tax is:

Suppose in the absence of a tax a firm employs 50 skilled workers at a wage rate of $20 per labor hour.If the supply of labor is perfectly inelastic,what will be the impact of a $2.50 per hour tax on the net wage received by the workers and total employment?

According to the U.S.Congressional Budget Office,immigrants in the United States:

Suppose the firms in a competitive industry form a cartel to reduce the price of one of the inputs they purchase.Which of the following will result from this collusive behavior?

Identify some of the reasons due to which wage rates may differ among individuals even in the absence of gender or racial discrimination.

When the supply curve of labor is perfectly inelastic the burden of a social security tax is:

Which of the following is not a predictable result of a refusal by a small number of employers to hire African Americans?

Provide a self-interested explanation for why labor unions spend a lot of time and money lobbying for increases in minimum wage mandates and for legislated "living wage" ordinances even though their members earn far more than the proposed wages.

An aggregate labor supply curve is likely to be vertical if:

Explain graphically that a payroll tax imposed by the government either on the employers or on the employees will have a similar impact.

Which of the following defines an efficiency wage?

A change in the social security system which required employers to pay the full amount of the social security tax rather than the 50 percent they now pay would:

Explain how you would investigate whether wage differences are due to discrimination.

Employers sometimes reduce the fringe benefits provided to workers when the government sets a minimum wage in the labor market.Due to this:

The disemployment effect of the minimum wage refers to the tendency of employers to:

Discrimination might exist in a labor market at times,but it is not likely to last in the long run because:

The National Collegiate Athletic Association [NCAA] is a private organization empowered to regulate various aspects of college athletics.If this organization is somehow unable to prohibit schools that violate its rules from participating in postseason tournaments,we can expect:

An employer's cartel will seek to:

An Introduction to Microeconomics

Supply and Demand

The Theory of Consumer Choice

Individual and Market Demand

Using Consumer Choice Theory

Exchange, Efficiency, and Prices

Production

The Cost of Production

Profit Maximization in Perfectly Competitive Markets

Using the Competitive Model

Monopoly

Product Pricing With Monopoly Power

Monopolistic Competition and Oligopoly

Game Theory and the Economics of Information

Using Noncompetitive Market Models

Employment and Pricing of Inputs

Wages, Rent, Interest, and Profit

General Equilibrium Analysis and Economic Efficiency

Public Goods and Externalities

Filters