Question 1

Exhibit 28-7
  
-Refer to Exhibit 28-7.The marginal factor cost of increasing employment from 40 to 50 workers is

Accepted Answer

A)  $120. 
B)  $18. 
C)  $14. 
D)  $160. 
E)  $15 
A)  $120. 
B)  $18. 
C)  $14. 
D)  $160. 
E)  $15

Question 2

Exhibit 28-5
  
-Refer to Exhibit 28-5.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)  none of the above 
A)  (1) 
B)  (2) 
C)  (3) 
D)  none of the above

Question 3

Describe the difference between the traditional (or orthodox)view of labor unions and the labor-union-as-collective-voice view of labor unions with respect to the impact that unions have on productivity and efficiency.

Accepted Answer

The traditional view holds that labor un

Question 4

Which of the following is true?

Accepted Answer

A)  The orthodox view of labor unions predicts that unionization of a firm will result in improvements in productivity and efficiency. 
B)  The labor-union-as-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-collective-voice view of labor unions supports efforts to decrease the unions' role as "monopolizer of labor." 
E)  none of the above 
A)  The orthodox view of labor unions predicts that unionization of a firm will result in improvements in productivity and efficiency. 
B)  The labor-union-as-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-collective-voice view of labor unions supports efforts to decrease the unions' role as "monopolizer of labor." 
E)  none of the above

Question 5

In your text 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 more than nonunion workers. 
D)  the number of union workers is greater than the number of nonunion workers. 
E)  a and c 
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 more than nonunion workers. 
D)  the number of union workers is greater than the number of nonunion workers. 
E)  a and c

Question 6

In 18th century England,higher wages of weavers appears to have led to the invention of the power loom.

Accepted Answer

A) True 
 B)False

Question 7

Successful collective bargaining (on the part of a labor union)will

Accepted Answer

A)  increase the demand for labor. 
B)  decrease the demand for labor. 
C)  change the marginal physical product of labor. 
D)  a and c 
E)  none of the above 
A)  increase the demand for labor. 
B)  decrease the demand for labor. 
C)  change the marginal physical product of labor. 
D)  a and c 
E)  none of the above

Question 8

Which of the following is a possible objective of labor unions?

Accepted Answer

A)  employment for all union members 
B)  maximizing the total (union) wage bill 
C)  maximizing income for a limited number of union members 
D)  a and b 
E)  a, b, and c 
A)  employment for all union members 
B)  maximizing the total (union) wage bill 
C)  maximizing income for a limited number of union members 
D)  a and b 
E)  a, b, and c

Question 9

Exhibit 28-8
  
-Refer to Exhibit 28-8.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 10

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. 
E)  none of the above 
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. 
E)  none of the above

Question 11

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 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

Exhibit 28-7
  
-Refer to Exhibit 28-7.As the firm increases employment from 50 to 60 workers,by how much does total labor cost increase?

Accepted Answer

A)  $160 
B)  $40 
C)  $60 
D)  $200 
A)  $160 
B)  $40 
C)  $60 
D)  $200

Question 14

Exhibit 28-8
  
-Refer to Exhibit 28-8.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 15

Labor unions try to meet their objectives by influencing the elasticity of demand for labor and the demand for labor.To influence these factors,they try to do all the following except

Accepted Answer

A)  reduce the availability of substitutes for the product they produce. 
B)  reduce the availability of substitute factors. 
C)  increase demand for the product they produce. 
D)  increase substitute factor prices. 
E)  reduce the nonmoney benefits of substitute factors. 
A)  reduce the availability of substitutes for the product they produce. 
B)  reduce the availability of substitute factors. 
C)  increase demand for the product they produce. 
D)  increase substitute factor prices. 
E)  reduce the nonmoney benefits of substitute factors.

Question 16

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 17

If workers can do the work in both the unionized sector and the nonunionized sector,then an increase in the wage rate paid in the unionized sector (relative to the wage rate paid in the nonunionized sector),which is brought about by a permanent leftward shift in the labor supply curve,will lead to

Accepted Answer

A)  an increase in the supply of labor in the nonunionized sector and lower wages in that sector. 
B)  an increase in the supply of labor in the unionized sector and lower wages in that sector. 
C)  no change in the supply of labor in either of the sectors mentioned. 
D)  an increase in the supply of labor in the unionized sector and even higher wages in that sector. 
E)  There is not enough information to answer the question. 
A)  an increase in the supply of labor in the nonunionized sector and lower wages in that sector. 
B)  an increase in the supply of labor in the unionized sector and lower wages in that sector. 
C)  no change in the supply of labor in either of the sectors mentioned. 
D)  an increase in the supply of labor in the unionized sector and even higher wages in that sector. 
E)  There is not enough information to answer the question.

Question 18

Labor unions obtain higher wages for their members by reducing the profits of the business owners in the short run and in the long run.

Accepted Answer

A) True 
 B)False

Question 19

Most likely,if a labor union wanted to employ all its membership it would negotiate for a __________ than if it wanted to maximize the income of a limited number of union members.

Accepted Answer

A)  wage that discounted for fixed costs 
B)  higher wage 
C)  wage that accounted for a percentage of sales revenues 
D)  lower wage 
E)  none of the above 
A)  wage that discounted for fixed costs 
B)  higher wage 
C)  wage that accounted for a percentage of sales revenues 
D)  lower wage 
E)  none of the above

Question 20

Exhibit 28-2
  
-Refer to Exhibit 28-2.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.

Exam 28: Wages,Unions,and Labor

Exhibit 28-7 -Refer to Exhibit 28-7.The marginal factor cost of increasing employment from 40 to 50 workers is

Exhibit 28-5 -Refer to Exhibit 28-5.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?

Describe the difference between the traditional (or orthodox)view of labor unions and the labor-union-as-collective-voice view of labor unions with respect to the impact that unions have on productivity and efficiency.

Which of the following is true?

In your text 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,

In 18th century England,higher wages of weavers appears to have led to the invention of the power loom.

Successful collective bargaining (on the part of a labor union)will

Which of the following is a possible objective of labor unions?

Exhibit 28-8 -Refer to Exhibit 28-8.If the monopsonist could perfectly discriminate by paying each worker a different wage rate,the number of workers employed would be

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

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

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

Exhibit 28-7 -Refer to Exhibit 28-7.As the firm increases employment from 50 to 60 workers,by how much does total labor cost increase?

Exhibit 28-8 -Refer to Exhibit 28-8.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

Labor unions try to meet their objectives by influencing the elasticity of demand for labor and the demand for labor.To influence these factors,they try to do all the following except

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

If workers can do the work in both the unionized sector and the nonunionized sector,then an increase in the wage rate paid in the unionized sector (relative to the wage rate paid in the nonunionized sector),which is brought about by a permanent leftward shift in the labor supply curve,will lead to

Labor unions obtain higher wages for their members by reducing the profits of the business owners in the short run and in the long run.

Most likely,if a labor union wanted to employ all its membership it would negotiate for a __________ than if it wanted to maximize the income of a limited number of union members.

Exhibit 28-2 -Refer to Exhibit 28-2.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

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Exhibit 28-5 -Refer to Exhibit 28-5.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?