Question 1

Explain the relationship between the minimum wage and the unemployment rate for teenagers.

Accepted Answer

Increases in the minimum wage lead to in

Question 2

What type of cost is not relevant to the process of research and development or invention in general?

Accepted Answer

A) Fixed cost 
B) Marginal cost 
C) Variable cost 
D) Social cost 
A) Fixed cost 
B) Marginal cost 
C) Variable cost 
D) Social cost

Question 3

What are the alternative views to the human capital theory with respect to the role of education?

Accepted Answer

One alternative dissenting view sees edu

Question 4

The price of leisure is the

Accepted Answer

A) wage rate. 
B) interest rate. 
C) discount rate. 
D) rate of return on investment. 
A) wage rate. 
B) interest rate. 
C) discount rate. 
D) rate of return on investment.

Question 5

The wage increase from investments in human capital is called economic rents.

Accepted Answer

A) True 
 B)False

Question 6

The more money firms spend on R&D the faster the economy is expected to grow.

Accepted Answer

A) True 
 B)False

Question 7

The concept of economic rent applies to

Accepted Answer

A) all wage and salary earners. 
B) no wage or salary earners. 
C) only owners of real estate. 
D) people with rare valuable skills. 
A) all wage and salary earners. 
B) no wage or salary earners. 
C) only owners of real estate. 
D) people with rare valuable skills.

Question 8

Explain the circumstances under which some component of labor income is economic rent.

Accepted Answer

Economic rent is a payment to a factor a

Question 9

The more specialized and highly valued a worker's skills are,

Accepted Answer

A) the lower is the worker's stock of human capital. 
B) the more likely the worker is to earn economic rent. 
C) the less likely the worker is to sell the skills on the primary labor market. 
D) the more likely the worker is to be directly affected by minimum wage legislation. 
A) the lower is the worker's stock of human capital. 
B) the more likely the worker is to earn economic rent. 
C) the less likely the worker is to sell the skills on the primary labor market. 
D) the more likely the worker is to be directly affected by minimum wage legislation.

Question 10

The fact that invention is based largely on fixed costs and is a public good means that which of the following is not relevant to the process?

Accepted Answer

A) Average total cost 
B) Marginal cost 
C) External cost 
D) Average variable cost 
A) Average total cost 
B) Marginal cost 
C) External cost 
D) Average variable cost

Question 11

College graduates now earn nearly twice as much as their high school-educated peers and that gap is increasing.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following was not invented centuries ago in China?

Accepted Answer

A) Gunpowder 
B) The wheelbarrow 
C) Printing with movable type 
D) Winding clocks 
A) Gunpowder 
B) The wheelbarrow 
C) Printing with movable type 
D) Winding clocks

Question 13

Explain how the demand for labor is determined.

Accepted Answer

The demand for labor is the downward-slo

Question 14

Wages will tend to be high in labor markets where supply is relatively high and demand is relatively weak.

Accepted Answer

A) True 
 B)False

Question 15

Globalization was much more pervasive in the 1800s than it is today.

Accepted Answer

A) True 
 B)False

Question 16

Regarding new inventions, which of the following statements is not true?

Accepted Answer

A) A new invention typically has little competition. 
B) This effective monopoly on the market earns the inventor abundant profit. 
C) That profit gets the attention of other potential inventors, who create competing products. 
D) Reduced to zero economic profits, the inventor goes out of business. 
A) A new invention typically has little competition. 
B) This effective monopoly on the market earns the inventor abundant profit. 
C) That profit gets the attention of other potential inventors, who create competing products. 
D) Reduced to zero economic profits, the inventor goes out of business.

Question 17

History has shown that over the long run, labor-saving technology has actually not reduced employment.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is least likely to affect the supply of labor in any particular industry?

Accepted Answer

A) The size of the available working population 
B) The nonmonetary attractiveness of the job 
C) The amount of ability and training necessary to enter the job 
D) The wages offered in the industry 
A) The size of the available working population 
B) The nonmonetary attractiveness of the job 
C) The amount of ability and training necessary to enter the job 
D) The wages offered in the industry

Question 19

The United States suffers more from strikes than Japan but fewer strikes than Canada.

Accepted Answer

A) True 
 B)False

Question 20

Evidence indicates that the average economic profits of invention are

Accepted Answer

A) well above zero. 
B) slightly above zero. 
C) equal to zero. 
D) less than zero. 
A) well above zero. 
B) slightly above zero. 
C) equal to zero. 
D) less than zero.

Exam 19: Labor and Entrepreneurship: the Human Inputs

Explain the relationship between the minimum wage and the unemployment rate for teenagers.

What type of cost is not relevant to the process of research and development or invention in general?

What are the alternative views to the human capital theory with respect to the role of education?

The price of leisure is the

The wage increase from investments in human capital is called economic rents.

The more money firms spend on R&D the faster the economy is expected to grow.

The concept of economic rent applies to

Explain the circumstances under which some component of labor income is economic rent.

The more specialized and highly valued a worker's skills are,

The fact that invention is based largely on fixed costs and is a public good means that which of the following is not relevant to the process?

College graduates now earn nearly twice as much as their high school-educated peers and that gap is increasing.

Which of the following was not invented centuries ago in China?

Explain how the demand for labor is determined.

Wages will tend to be high in labor markets where supply is relatively high and demand is relatively weak.

Globalization was much more pervasive in the 1800s than it is today.

Regarding new inventions, which of the following statements is not true?

History has shown that over the long run, labor-saving technology has actually not reduced employment.

Which of the following is least likely to affect the supply of labor in any particular industry?

The United States suffers more from strikes than Japan but fewer strikes than Canada.

Evidence indicates that the average economic profits of invention are

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Monopoly

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

The Economics of the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

Monetary Policy: Conventional and Unconventional

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Useconomy

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