Question 1

Human capital is

Accepted Answer

A) a stock of equipment and structures. 
B) the result of investments workers make in themselves such as education. 
C) a difference in wages that arises to offset the nonmonetary characteristics of different jobs. 
D) a characteristic that affects a worker's self-esteem but not her wages. 
A) a stock of equipment and structures. 
B) the result of investments workers make in themselves such as education. 
C) a difference in wages that arises to offset the nonmonetary characteristics of different jobs. 
D) a characteristic that affects a worker's self-esteem but not her wages.

Question 2

Difference in wages can be explained by differences in

Accepted Answer

A) job characteristics and worker characteristics. 
B) job characteristics but not worker characteristics. 
C) worker characteristics but not job characteristics. 
D) neither worker characteristics or job characteristics. 
A) job characteristics and worker characteristics. 
B) job characteristics but not worker characteristics. 
C) worker characteristics but not job characteristics. 
D) neither worker characteristics or job characteristics.

Question 3

Which of the following helps to explain the differences in earnings in the United States?

Accepted Answer

A) ability, effort, and chance 
B) compensating differentials 
C) physical attractiveness 
D) All of the above are correct. 
A) ability, effort, and chance 
B) compensating differentials 
C) physical attractiveness 
D) All of the above are correct.

Question 4

The idea of paying workers an efficiency wage is that

Accepted Answer

A) employers will find it profitable to hire more workers. 
B) workers receive wages consistent with their specific compensating differentials. 
C) workers and management gain at the expense of the stockholders of the company. 
D) workers have the incentive to work harder, thus increasing their marginal productivity. 
A) employers will find it profitable to hire more workers. 
B) workers receive wages consistent with their specific compensating differentials. 
C) workers and management gain at the expense of the stockholders of the company. 
D) workers have the incentive to work harder, thus increasing their marginal productivity.

Question 5

Why can superstar athletes and movie stars earn multimillion dollar salaries but superstar electricians and professors cannot?

Accepted Answer

A) Every customer in the market wants to enjoy the good supplied by the best producer. 
B) Technology makes it possible for the best producer to supply every customer at low cost. 
C) Customers are willing to pay more for entertainment than other services. 
D) Both a and b are correct. 
A) Every customer in the market wants to enjoy the good supplied by the best producer. 
B) Technology makes it possible for the best producer to supply every customer at low cost. 
C) Customers are willing to pay more for entertainment than other services. 
D) Both a and b are correct.

Question 6

Economists who study labor markets have documented

Accepted Answer

A) a general decline in the wages of college graduates over the last decade. 
B) an increasing trend in U.S. labor markets for employers to pay all costs of education and training. 
C) a decrease in the earnings gap between low-skill and high-skill workers over the past two decades. 
D) an increase in the earnings gap between low-skill and high-skill workers over the past two decades. 
A) a general decline in the wages of college graduates over the last decade. 
B) an increasing trend in U.S. labor markets for employers to pay all costs of education and training. 
C) a decrease in the earnings gap between low-skill and high-skill workers over the past two decades. 
D) an increase in the earnings gap between low-skill and high-skill workers over the past two decades.

Question 7

Figure 19-6  
-Refer to Figure 19-6. Given demand, D1, and supply, S1, if wages adjust to balance labor supply and labor demand, what are the wage and quantity of labor?

Accepted Answer

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

Question 8

What is the term for offering different opportunities to similar individuals who differ only by race, ethnic group, sex, age, or other personal characteristics?

Accepted Answer

The answer of What is the term for offering different...

Question 9

A compensation scheme that pays salespeople a percentage of the sales they make is attempting to reward

Accepted Answer

A) work effort. 
B) loyalty to the firm. 
C) years of schooling. 
D) years of experience. 
A) work effort. 
B) loyalty to the firm. 
C) years of schooling. 
D) years of experience.

Question 10

Who among the following individuals most likely experiences the largest nonmonetary reward as a supplier of labor? Assume all of the four individuals have the same level of education and work the same number of hours per week.

Accepted Answer

A) Albert, who prefers not to socialize and works at home by himself 
B) Amy, whose job provides little intellectual and personal satisfaction 
C) Antoinette, whose preference is to avoid dangerous work but works as a firefighter 
D) Arnold, who works the night shift but would prefer to work during the day and sleep at night 
A) Albert, who prefers not to socialize and works at home by himself 
B) Amy, whose job provides little intellectual and personal satisfaction 
C) Antoinette, whose preference is to avoid dangerous work but works as a firefighter 
D) Arnold, who works the night shift but would prefer to work during the day and sleep at night

Question 11

Suppose that an employer can hire workers with brown hair and workers with blonde hair. Each type of worker has the same productivity. Which of the following is correct if the employer discriminates by hiring only workers with brown hair?

Accepted Answer

A) The employer will be just as efficient as a nondiscriminating employer. 
B) The employer will face higher costs than firms that focus only on maximizing profits. 
C) The employer will immediately go out of business because discrimination is illegal. 
D) The employer will face union strikes. 
A) The employer will be just as efficient as a nondiscriminating employer. 
B) The employer will face higher costs than firms that focus only on maximizing profits. 
C) The employer will immediately go out of business because discrimination is illegal. 
D) The employer will face union strikes.

Question 12

In order to explain the changing gap in earnings between skilled and unskilled workers in recent years, economists have proposed two hypotheses. One hypothesis emphasizes

Accepted Answer

A) compensating differentials. 
B) the increased recognition that a larger stock of human capital usually leads to higher earnings. 
C) the decreasing importance of labor unions. 
D) the increasing importance of international trade. 
A) compensating differentials. 
B) the increased recognition that a larger stock of human capital usually leads to higher earnings. 
C) the decreasing importance of labor unions. 
D) the increasing importance of international trade.

Question 13

Other things equal, when the supply of workers is low, one would predict that market wages would be

Accepted Answer

A) relatively high. 
B) relatively low. 
C) determined solely by factors that affect demand. 
D) determined outside the domain of economic theory. 
A) relatively high. 
B) relatively low. 
C) determined solely by factors that affect demand. 
D) determined outside the domain of economic theory.

Question 14

Studies of wages by labor economists indicate that measurable variables such as age, job characteristics, years of education, and years of experience account for

Accepted Answer

A) virtually none of the variation in wages in our economy. 
B) some, but less than 50 percent of the variation in wages in our economy. 
C) about 75 percent of the variation in wages in our economy. 
D) almost all of the variation in wages in our economy. 
A) virtually none of the variation in wages in our economy. 
B) some, but less than 50 percent of the variation in wages in our economy. 
C) about 75 percent of the variation in wages in our economy. 
D) almost all of the variation in wages in our economy.

Question 15

Scenario 19-7
Mark works full time at a large accounting firm. Mark has been at the firm for four years but has not been given a promotion, even though newer employees have already been promoted. Mark believes he is a victim of labor-market discrimination, and threatens to hire a lawyer to sue the company.
​
-Refer to Scenario 19-7. Which of the following would weaken Mark's case against his employer?

Accepted Answer

A) Mark is more productive than other newly-hired accountants who were promoted before he was. 
B) Mark works more than any other accountant in the firm. 
C) Newly hired employees who were promoted before Mark had extensive previous accounting experience. 
D) Newly hired employees who were promoted before Mark are more well-liked by other accountants in the firm. 
A) Mark is more productive than other newly-hired accountants who were promoted before he was. 
B) Mark works more than any other accountant in the firm. 
C) Newly hired employees who were promoted before Mark had extensive previous accounting experience. 
D) Newly hired employees who were promoted before Mark are more well-liked by other accountants in the firm.

Question 16

It is illegal in the United States for firms to pay different employees different wages for doing the same job.

Accepted Answer

A) True 
 B)False

Question 17

Evidence of differences in average wages of women compared to men

Accepted Answer

A) clearly illustrates differences in productivity between genders. 
B) provides conclusive evidence of discrimination on the basis of gender. 
C) is seldom used to provide evidence of discriminatory bias. 
D) does not provide conclusive evidence of discrimination. 
A) clearly illustrates differences in productivity between genders. 
B) provides conclusive evidence of discrimination on the basis of gender. 
C) is seldom used to provide evidence of discriminatory bias. 
D) does not provide conclusive evidence of discrimination.

Question 18

By definition, there is discrimination when the marketplace offers different opportunities to similar individuals who differ only by

Accepted Answer

A) race, ethnic group, sex, age, or other personal characteristics. 
B) qualifications, experience, or job preferences. 
C) levels of human capital. 
D) All of the above are correct. 
A) race, ethnic group, sex, age, or other personal characteristics. 
B) qualifications, experience, or job preferences. 
C) levels of human capital. 
D) All of the above are correct.

Question 19

Figure 19-6​  
-Refer to Figure 19-6. This figure depicts labor demand and supply for the widget industry. The equilibrium market wage is $15. Suppose a labor union forms and subsequently negotiates an hourly wage of $20.00. Which of the following statements about the impact of the union's formation on labor hours demanded is true?

Accepted Answer

A) Labor hours demanded by widget firms will decrease by 20 hours. 
B) Labor hours demanded by widget firms will decrease by 30 hours. 
C) Labor hours demanded by widget firms will increase by 20 hours. 
D) Labor hours demanded by widget firms will increase by 30 hours. 
A) Labor hours demanded by widget firms will decrease by 20 hours. 
B) Labor hours demanded by widget firms will decrease by 30 hours. 
C) Labor hours demanded by widget firms will increase by 20 hours. 
D) Labor hours demanded by widget firms will increase by 30 hours.

Question 20

When robots are used to replace workers on a factory production line, the wage gap between skilled and unskilled workers

Accepted Answer

A) will increase only if the company can increase the price of its product. 
B) is likely to increase. 
C) is likely to decrease. 
D) will not change. 
A) will increase only if the company can increase the price of its product. 
B) is likely to increase. 
C) is likely to decrease. 
D) will not change.

Exam 19: Earnings and Discrimination

Human capital is

Difference in wages can be explained by differences in

Which of the following helps to explain the differences in earnings in the United States?

The idea of paying workers an efficiency wage is that

Why can superstar athletes and movie stars earn multimillion dollar salaries but superstar electricians and professors cannot?

Economists who study labor markets have documented

Figure 19-6 -Refer to Figure 19-6. Given demand, D1, and supply, S1, if wages adjust to balance labor supply and labor demand, what are the wage and quantity of labor?

What is the term for offering different opportunities to similar individuals who differ only by race, ethnic group, sex, age, or other personal characteristics?

A compensation scheme that pays salespeople a percentage of the sales they make is attempting to reward

Who among the following individuals most likely experiences the largest nonmonetary reward as a supplier of labor? Assume all of the four individuals have the same level of education and work the same number of hours per week.

Suppose that an employer can hire workers with brown hair and workers with blonde hair. Each type of worker has the same productivity. Which of the following is correct if the employer discriminates by hiring only workers with brown hair?

In order to explain the changing gap in earnings between skilled and unskilled workers in recent years, economists have proposed two hypotheses. One hypothesis emphasizes

Other things equal, when the supply of workers is low, one would predict that market wages would be

Studies of wages by labor economists indicate that measurable variables such as age, job characteristics, years of education, and years of experience account for

It is illegal in the United States for firms to pay different employees different wages for doing the same job.

Evidence of differences in average wages of women compared to men

By definition, there is discrimination when the marketplace offers different opportunities to similar individuals who differ only by

When robots are used to replace workers on a factory production line, the wage gap between skilled and unskilled workers

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

Applications: 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

Measuring a Nation S Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

Unemployment and Its Natural Rate

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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