Question 1

The competition experiment conducted by economists Muriel Niederle and Lise Vesterlund was consistent with the results of Terry Odean which were that

Accepted Answer

A) men were better at math than women. 
B) men chose competition more because they were better at sports than women. 
C) men trade stocks excessively while women adopt a buy-and-hold strategy. 
D) streetcar companies were not in favor of segregation because it hurt their profits. 
A) men were better at math than women. 
B) men chose competition more because they were better at sports than women. 
C) men trade stocks excessively while women adopt a buy-and-hold strategy. 
D) streetcar companies were not in favor of segregation because it hurt their profits.

Question 2

A recent law school graduate is considering two offers to practice law, one in New York and one in Illinois. The New York bar exam is very difficult to pass compared with Illinois's exam. Assuming all other things equal, the attorney would expect

Accepted Answer

A) to be unable to predict the wage difference between Illinois and New York. 
B) to make a lower wage in New York. 
C) to make a lower wage in Illinois. 
D) wages in Illinois and New York to be identical. 
A) to be unable to predict the wage difference between Illinois and New York. 
B) to make a lower wage in New York. 
C) to make a lower wage in Illinois. 
D) wages in Illinois and New York to be identical.

Question 3

Suppose that a company hires recent college graduates for two types of jobs, sales people and credit analysts. The hours worked and skill levels are the same for both positions. The sales people must "cold call," which many people find to be unpleasant. When comparing the salaries of the two positions, it is likely that the company pays the

Accepted Answer

A) credit analysts more as a compensating differential. 
B) sales people more as a compensating differential. 
C) same salary for both positions because they require the same skill level. 
D) same salary for both positions because it would be illegal to do otherwise. 
A) credit analysts more as a compensating differential. 
B) sales people more as a compensating differential. 
C) same salary for both positions because they require the same skill level. 
D) same salary for both positions because it would be illegal to do otherwise.

Question 4

Discrimination may persist even in competitive markets when the source of the discrimination is

Accepted Answer

A) employer prejudice. 
B) customer prejudice. 
C) wage prejudice. 
D) employee prejudice. 
A) employer prejudice. 
B) customer prejudice. 
C) wage prejudice. 
D) employee prejudice.

Question 5

According to the Hamermesh and Biddle study, people deemed more attractive than average earn

Accepted Answer

A) 30-40 percent more than unattractive people. 
B) about 5 percent more than average looking people. 
C) the same as average looking people and 15-20 percent more than unattractive people. 
D) 25 percent more than average looking people and 50 percent more than unattractive people. 
A) 30-40 percent more than unattractive people. 
B) about 5 percent more than average looking people. 
C) the same as average looking people and 15-20 percent more than unattractive people. 
D) 25 percent more than average looking people and 50 percent more than unattractive people.

Question 6

In the United States, the earnings gap between workers with college degrees and workers with high school degrees

Accepted Answer

A) has never been documented by reliable evidence. 
B) is evident, but it has remained roughly constant over the past several years. 
C) is evident, but it has diminished over the last several years. 
D) is evident, and it has widened over the last several years. 
A) has never been documented by reliable evidence. 
B) is evident, but it has remained roughly constant over the past several years. 
C) is evident, but it has diminished over the last several years. 
D) is evident, and it has widened over the last several years.

Question 7

Name two occupations that have the two characteristics required for the superstar phenomenon.

Accepted Answer

The answer of Name two occupations that have the two...

Question 8

Two economists created fake resumes with either common African-American names such as Lakisha and Jamal or common white names such as Emily and Greg. After sending them to potential employers with "Help Wanted" ads in Boston and Chicago newspapers, they found that

Accepted Answer

A) black employees earned 50 percent less than white employees in Chicago but that blacks and whites had similar wages in Boston. 
B) black employees earned 50 percent less than white employees in Boston but that blacks and whites had similar wages in Chicago. 
C) job applicants with white names received 50 percent more phone calls from interested employers. 
D) job applicants with white names received 7 percent more phone calls from interested employers. 
A) black employees earned 50 percent less than white employees in Chicago but that blacks and whites had similar wages in Boston. 
B) black employees earned 50 percent less than white employees in Boston but that blacks and whites had similar wages in Chicago. 
C) job applicants with white names received 50 percent more phone calls from interested employers. 
D) job applicants with white names received 7 percent more phone calls from interested employers.

Question 9

In recent years, the amount of international trade in which the United States engages has

Accepted Answer

A) increased, raising domestic demand for unskilled labor. 
B) increased, reducing domestic demand for unskilled labor. 
C) decreased, raising domestic demand for unskilled labor. 
D) decreased, reducing domestic demand for unskilled labor. 
A) increased, raising domestic demand for unskilled labor. 
B) increased, reducing domestic demand for unskilled labor. 
C) decreased, raising domestic demand for unskilled labor. 
D) decreased, reducing domestic demand for unskilled labor.

Question 10

Figure 19-6  
-Refer to Figure 19-6. Given demand, D1, and supply, S1, what is the quantity of labor demanded if a minimum wage of $8 per hour is imposed on this market?

Accepted Answer

The answer of Figure 19-6  
-Refer to Figure 19-6....

Question 11

Figure 19-5  
-Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Accepted Answer

A) Fewer workers are employed, but those who are employed earn a higher wage. 
B) More workers are employed but they earn a lower wage. 
C) More workers are employed and they earn a higher wage. 
D) The same number of workers are employed and they earn a higher wage. 
A) Fewer workers are employed, but those who are employed earn a higher wage. 
B) More workers are employed but they earn a lower wage. 
C) More workers are employed and they earn a higher wage. 
D) The same number of workers are employed and they earn a higher wage.

Question 12

After graduating from college, you receive job offers from five different accounting firms. All job offers have a different compensation package. Is it irrational for you to accept an offer that doesn't provide the highest level of monetary compensation? Use the concept of compensating differentials to explain your answer.

Accepted Answer

Compensating differentials refer to diff

Question 13

Which of the following would be considered an investment in human capital?

Accepted Answer

A) education 
B) a teacher's blackboard 
C) the purchase of a new computer to enhance labor productivity 
D) All of the above are correct. 
A) education 
B) a teacher's blackboard 
C) the purchase of a new computer to enhance labor productivity 
D) All of the above are correct.

Question 14

Which of the following would both make a worker's wage higher than otherwise?

Accepted Answer

A) the work is safe, the employer pays an efficiency wage 
B) the work is safe, the employer does not pay an efficiency wage 
C) the work is dangerous, the employer pays an efficiency wage 
D) the work is dangerous, the employer does not pay and efficiency wage 
A) the work is safe, the employer pays an efficiency wage 
B) the work is safe, the employer does not pay an efficiency wage 
C) the work is dangerous, the employer pays an efficiency wage 
D) the work is dangerous, the employer does not pay and efficiency wage

Question 15

The statement "the rich get richer and the poor get poorer" is evident in the fact that

Accepted Answer

A) the earnings gap between high-skill jobs and low-skill jobs has increased over the last several years. 
B) developing countries do not pay workers the value of their marginal product. 
C) developed economies export high-skill jobs to developing countries. 
D) All of the above are correct. 
A) the earnings gap between high-skill jobs and low-skill jobs has increased over the last several years. 
B) developing countries do not pay workers the value of their marginal product. 
C) developed economies export high-skill jobs to developing countries. 
D) All of the above are correct.

Question 16

Scenario 19-6​
The after-school tutoring industry is competitive, and so is the labor market for after-school tutors. Suppose male and female tutors have equal experience and skill. Currently, some tutoring centers are biased and will only hire male tutors, while unbiased tutoring centers desire to hire the cheapest tutors and do not care about their genders. As a result, the equilibrium wage for male tutors is higher than that of female tutors.
-Refer to Scenario 19-6. If some families strongly prefer their children to be tutored by male tutors, then

Accepted Answer

A) the difference in male and female tutor wages will eventually disappear. 
B) biased tutoring centers can charge more for tutoring to offset the higher cost of hiring only male tutors 
C) all unbiased tutoring centers will go out of business in the long run. 
D) all biased tutoring centers will make a profit in the short run, but will go out of business in the long run. 
A) the difference in male and female tutor wages will eventually disappear. 
B) biased tutoring centers can charge more for tutoring to offset the higher cost of hiring only male tutors 
C) all unbiased tutoring centers will go out of business in the long run. 
D) all biased tutoring centers will make a profit in the short run, but will go out of business in the long run.

Question 17

Scenario 19-4
Assume that the labor market for barbers is competitive and that it is differentiated into two groups: barbers who are bald (or going bald) and those who have a full head of hair. Assume that the barbers in this market have identical hair-cutting ability, regardless of whether they are bald or not. Currently the equilibrium wage in the bald barber market is lower than that in the nonbald market. Further assume that the market for haircuts is competitive.
-Refer to Scenario 19-4. Competition in the market for haircuts is consistent with which of the following statements?

Accepted Answer

A) Firms hiring nonbald barbers will have a cost advantage, leading to an increase in the demand for nonbald barbers. 
B) All firms that hire only bald barbers will go out of business. 
C) Firms hiring bald barbers will enter the market, increasing the demand for bald barbers. 
D) Firms hiring nonbald barbers will enter the market, increasing the demand for nonbald barbers. 
A) Firms hiring nonbald barbers will have a cost advantage, leading to an increase in the demand for nonbald barbers. 
B) All firms that hire only bald barbers will go out of business. 
C) Firms hiring bald barbers will enter the market, increasing the demand for bald barbers. 
D) Firms hiring nonbald barbers will enter the market, increasing the demand for nonbald barbers.

Question 18

Scenario 19-4
Assume that the labor market for barbers is competitive and that it is differentiated into two groups: barbers who are bald (or going bald) and those who have a full head of hair. Assume that the barbers in this market have identical hair-cutting ability, regardless of whether they are bald or not. Currently the equilibrium wage in the bald barber market is lower than that in the nonbald market. Further assume that the market for haircuts is competitive.
-Refer to Scenario 19-4. If consumers do not discriminate between bald barbers and barbers with hair, then

Accepted Answer

A) all barbershops now earn a normal economic profit. 
B) competition will ensure the difference in wages will persist. 
C) barbershops that hire barbers with hair will be more profitable than those that don't. 
D) barbershops that hire bald barbers will be more profitable than those that don't. 
A) all barbershops now earn a normal economic profit. 
B) competition will ensure the difference in wages will persist. 
C) barbershops that hire barbers with hair will be more profitable than those that don't. 
D) barbershops that hire bald barbers will be more profitable than those that don't.

Question 19

When firms focus on profit maximization, which form of wage discrimination is least likely to occur?

Accepted Answer

A) discrimination based on race 
B) discrimination in sports 
C) consumer discrimination 
D) discrimination based on educational attainment 
A) discrimination based on race 
B) discrimination in sports 
C) consumer discrimination 
D) discrimination based on educational attainment

Question 20

If a worker is indifferent between a job with a wage of $10 per hour and a job with a wage of $12 per hour, then the

Accepted Answer

A) higher-paying job has a compensating wage differential of $2 per hour. 
B) higher-paying job has a compensating wage differential of $12 per hour. 
C) higher-paying job is intrinsically more attractive than the lower-paying job. 
D) wage in the higher-paying job must eventually fall due to competition. 
A) higher-paying job has a compensating wage differential of $2 per hour. 
B) higher-paying job has a compensating wage differential of $12 per hour. 
C) higher-paying job is intrinsically more attractive than the lower-paying job. 
D) wage in the higher-paying job must eventually fall due to competition.

The competition experiment conducted by economists Muriel Niederle and Lise Vesterlund was consistent with the results of Terry Odean which were that

A recent law school graduate is considering two offers to practice law, one in New York and one in Illinois. The New York bar exam is very difficult to pass compared with Illinois's exam. Assuming all other things equal, the attorney would expect

Discrimination may persist even in competitive markets when the source of the discrimination is

According to the Hamermesh and Biddle study, people deemed more attractive than average earn

In the United States, the earnings gap between workers with college degrees and workers with high school degrees

Name two occupations that have the two characteristics required for the superstar phenomenon.

Two economists created fake resumes with either common African-American names such as Lakisha and Jamal or common white names such as Emily and Greg. After sending them to potential employers with "Help Wanted" ads in Boston and Chicago newspapers, they found that

In recent years, the amount of international trade in which the United States engages has

Figure 19-6 -Refer to Figure 19-6. Given demand, D1, and supply, S1, what is the quantity of labor demanded if a minimum wage of $8 per hour is imposed on this market?

Figure 19-5 -Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Which of the following would be considered an investment in human capital?

Which of the following would both make a worker's wage higher than otherwise?

The statement "the rich get richer and the poor get poorer" is evident in the fact that

When firms focus on profit maximization, which form of wage discrimination is least likely to occur?

If a worker is indifferent between a job with a wage of $10 per hour and a job with a wage of $12 per hour, then the

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

Exam 19: Earnings and Discrimination

The competition experiment conducted by economists Muriel Niederle and Lise Vesterlund was consistent with the results of Terry Odean which were that

A recent law school graduate is considering two offers to practice law, one in New York and one in Illinois. The New York bar exam is very difficult to pass compared with Illinois's exam. Assuming all other things equal, the attorney would expect

Discrimination may persist even in competitive markets when the source of the discrimination is

According to the Hamermesh and Biddle study, people deemed more attractive than average earn

In the United States, the earnings gap between workers with college degrees and workers with high school degrees

Name two occupations that have the two characteristics required for the superstar phenomenon.

Two economists created fake resumes with either common African-American names such as Lakisha and Jamal or common white names such as Emily and Greg. After sending them to potential employers with "Help Wanted" ads in Boston and Chicago newspapers, they found that

In recent years, the amount of international trade in which the United States engages has

Figure 19-6 -Refer to Figure 19-6. Given demand, D1, and supply, S1, what is the quantity of labor demanded if a minimum wage of $8 per hour is imposed on this market?

Figure 19-5 -Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Which of the following would be considered an investment in human capital?

Which of the following would both make a worker's wage higher than otherwise?

The statement "the rich get richer and the poor get poorer" is evident in the fact that

When firms focus on profit maximization, which form of wage discrimination is least likely to occur?

If a worker is indifferent between a job with a wage of $10 per hour and a job with a wage of $12 per hour, then the

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters