Question 1

In empirical analyses of factors that help explain wages,

Accepted Answer

A) effort and ability are not likely to contribute to large differences in wages in the U.S. economy. 
B) economists typically find that measurable factors explain less than half of the variation in wages. 
C) economists typically find few factors that are not explicitly measurable. 
D) unmeasurable influences on wage differences are found to be quite small. 
A) effort and ability are not likely to contribute to large differences in wages in the U.S. economy. 
B) economists typically find that measurable factors explain less than half of the variation in wages. 
C) economists typically find few factors that are not explicitly measurable. 
D) unmeasurable influences on wage differences are found to be quite small.

Question 2

The market wage could be higher than the equilibrium wage if a worker

Accepted Answer

A) belongs to a labor union. 
B) is covered by a minimum-wage law. 
C) is paid an efficiency wage. 
D) All of the above are correct. 
A) belongs to a labor union. 
B) is covered by a minimum-wage law. 
C) is paid an efficiency wage. 
D) All of the above are correct.

Question 3

Which theory explains the fact that some firms may choose to pay their employees more then they would earn as determined by equilibrium in the labor market?

Accepted Answer

A) the theory of efficiency wages 
B) the marginal-productivity theory 
C) human-capital theory 
D) signaling theory 
A) the theory of efficiency wages 
B) the marginal-productivity theory 
C) human-capital theory 
D) signaling theory

Question 4

Which of the following would be considered human capital?

Accepted Answer

A) the financial capital a person earns over a lifetime of investing 
B) the machinery a worker uses to produce a product 
C) the training a worker receives when starting a new job 
D) the break room in a factory where employees go to have coffee 
A) the financial capital a person earns over a lifetime of investing 
B) the machinery a worker uses to produce a product 
C) the training a worker receives when starting a new job 
D) the break room in a factory where employees go to have coffee

Question 5

Figure 19-7  
-Refer to Figure 19-7. The figure shows labor demand and labor supply in a non-unionized labor market. If the current labor demand is D1 and the current labor supply is S1, when a union is established in this market and succeeds in raising the wage to $18 per hour, what is the change in the number of workers employed?

Accepted Answer

100 fewer

Question 6

The return to investment in human capital is observed

Accepted Answer

A) only when workers are assigned identical tasks. 
B) in the wage differential between workers. 
C) in the high school dropout rate in inner-city urban school districts. 
D) in the low wages of educated factory workers. 
A) only when workers are assigned identical tasks. 
B) in the wage differential between workers. 
C) in the high school dropout rate in inner-city urban school districts. 
D) in the low wages of educated factory workers.

Question 7

Which of the following factors affects the marginal productivity of a worker?

Accepted Answer

A) human capital 
B) the worker's disposable income 
C) compensating wage differentials 
D) discrimination based on age, race, or gender 
A) human capital 
B) the worker's disposable income 
C) compensating wage differentials 
D) discrimination based on age, race, or gender

Question 8

Some discriminatory hiring practices can be expected, even if markets are competitive, as a result of

Accepted Answer

A) unrestricted entry and exit in markets. 
B) lower costs of hiring. 
C) a perfectly elastic market demand. 
D) customer preferences. 
A) unrestricted entry and exit in markets. 
B) lower costs of hiring. 
C) a perfectly elastic market demand. 
D) customer preferences.

Question 9

Scenario 19-6
Suppose that in the competitive market for auto repair, firms prefer to hire men rather than women. Assume that the women applying for positions have the same skills, experience, and work ethic as the men. As a result of this discrimination, the demand for women is lower than it otherwise would be.
-Refer to Scenario 19-6. Suppose that consumers prefer to have men work on their auto repairs and are willing to pay higher prices to accommodate these preferences. What will happen to the wage differential between men and women?

Accepted Answer

The answer of Scenario 19-6
Suppose that in the competitive market...

Question 10

The statement that "the rich get richer, and the poor get poorer" is supported by evidence of an expanding wage gap between high-skill and low-skill workers.

Accepted Answer

A) True 
 B)False

Question 11

James earns a degree from a top university and is hired by a prominent firm because executives at the firm believe that graduates of this university must have a high ability level or they would not have graduated. Which of the following theories of education do the executives believe?

Accepted Answer

A) signaling theory 
B) human-capital theory 
C) compensating-differentials theory 
D) All of the above are correct. 
A) signaling theory 
B) human-capital theory 
C) compensating-differentials theory 
D) All of the above are correct.

Question 12

George and Brad are waiters at a local restaurant. The female customers prefer to be seated at the tables that George waits on because they think George is better looking than Brad. If George earns more than Brad because of his better looks, this is an example of

Accepted Answer

A) effort playing a key role in wage differences. 
B) differences in human capital. 
C) a beauty premium. 
D) a compensating differential. 
A) effort playing a key role in wage differences. 
B) differences in human capital. 
C) a beauty premium. 
D) a compensating differential.

Question 13

Cory has just graduated from veterinary school. He can earn $40,000 working at a small animal clinic or $50,000 working with farm animals and horses where the risks of getting injured by an animal are higher. The higher salary to work with larger animals is an example of

Accepted Answer

A) a compensating differential. 
B) signaling theory. 
C) an efficiency wage. 
D) efficient union bargaining. 
A) a compensating differential. 
B) signaling theory. 
C) an efficiency wage. 
D) efficient union bargaining.

Question 14

Which of the following statements is correct?

Accepted Answer

A) Compensating wage differentials reflect different skills of workers. 
B) Discrimination by employers affects the marginal productivity of workers. 
C) The signaling theory of education suggests that schooling does not affect worker productivity. 
D) The superstar phenomenon explains why more talented entertainers earn more than less talented entertainers. 
A) Compensating wage differentials reflect different skills of workers. 
B) Discrimination by employers affects the marginal productivity of workers. 
C) The signaling theory of education suggests that schooling does not affect worker productivity. 
D) The superstar phenomenon explains why more talented entertainers earn more than less talented entertainers.

Question 15

In a labor market free from discrimination, wages for workers that are employed by the same company will still differ.

Accepted Answer

A) True 
 B)False

Question 16

The signaling theory of education maintains that workers who complete specific levels of education signal their high productivity to potential employers.

Accepted Answer

A) True 
 B)False

Question 17

Workers who work the night shift at factories are paid more than similar workers who work the day shift due to a

Accepted Answer

compensati

Question 18

Among female workers over age 25, about what percent has a college degree? What is this percentage for black female workers over age 25?

Accepted Answer

The answer of Among female workers over age 25, about...

Question 19

Between 1975 and 2011, the wage gap between women with a high school education and women with a college education increased. In particular, in 2011 women with a college degree earned about

Accepted Answer

A) 12% more than women with a high school education. 
B) 26% more than women with a high school education. 
C) 70% more than women with a high school education. 
D) 81% more than women with a high school education. 
A) 12% more than women with a high school education. 
B) 26% more than women with a high school education. 
C) 70% more than women with a high school education. 
D) 81% more than women with a high school education.

Question 20

A prestigious private high school requires each of its teachers to have a Ph.D. in the subject they teach. This requirement is likely to

Accepted Answer

A) increase the supply of teachers to this school. 
B) increase wages for teachers at the private school relative to those at public schools. 
C) decrease the marginal product of teachers at the private school. 
D) All of the above are correct. 
A) increase the supply of teachers to this school. 
B) increase wages for teachers at the private school relative to those at public schools. 
C) decrease the marginal product of teachers at the private school. 
D) All of the above are correct.

Exam 19: Earnings and Discrimination

In empirical analyses of factors that help explain wages,

The market wage could be higher than the equilibrium wage if a worker

Which theory explains the fact that some firms may choose to pay their employees more then they would earn as determined by equilibrium in the labor market?

Which of the following would be considered human capital?

The return to investment in human capital is observed

Which of the following factors affects the marginal productivity of a worker?

Some discriminatory hiring practices can be expected, even if markets are competitive, as a result of

The statement that "the rich get richer, and the poor get poorer" is supported by evidence of an expanding wage gap between high-skill and low-skill workers.

James earns a degree from a top university and is hired by a prominent firm because executives at the firm believe that graduates of this university must have a high ability level or they would not have graduated. Which of the following theories of education do the executives believe?

George and Brad are waiters at a local restaurant. The female customers prefer to be seated at the tables that George waits on because they think George is better looking than Brad. If George earns more than Brad because of his better looks, this is an example of

Cory has just graduated from veterinary school. He can earn $40,000 working at a small animal clinic or $50,000 working with farm animals and horses where the risks of getting injured by an animal are higher. The higher salary to work with larger animals is an example of

Which of the following statements is correct?

In a labor market free from discrimination, wages for workers that are employed by the same company will still differ.

The signaling theory of education maintains that workers who complete specific levels of education signal their high productivity to potential employers.

Workers who work the night shift at factories are paid more than similar workers who work the day shift due to a

Among female workers over age 25, about what percent has a college degree? What is this percentage for black female workers over age 25?

Between 1975 and 2011, the wage gap between women with a high school education and women with a college education increased. In particular, in 2011 women with a college degree earned about

A prestigious private high school requires each of its teachers to have a Ph.D. in the subject they teach. This requirement is likely to

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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