Question 1

The statement that "coal miners are paid more than workers with similar levels of education" is likely to reflect the fact that

Accepted Answer

A)  coal mining is a declining industry. 
B)  coal mining jobs are potentially more dangerous than jobs with comparable education requirements. 
C)  all coal mines use nonunion labor. 
D)  coal imports are rising. 
A)  coal mining is a declining industry. 
B)  coal mining jobs are potentially more dangerous than jobs with comparable education requirements. 
C)  all coal mines use nonunion labor. 
D)  coal imports are rising.

Question 2

Bill and Hillary both work for the same bakery.Bill is an expert pastry chef who begins baking at 4a.m.Hillary is a bookkeeper who works a regular 9-5 work day.Bill earns twice as much as Hillary.Which of the following could explain the higher wages that Bill earns?

Accepted Answer

A)  The employer is discriminating against women. 
B)  The employer is paying a compensating differential for a job that starts very early in the morning. 
C)  The employer is rewarding Bill for acquiring the human capital of a pastry chef. 
D)  All of the above could be correct. 
A)  The employer is discriminating against women. 
B)  The employer is paying a compensating differential for a job that starts very early in the morning. 
C)  The employer is rewarding Bill for acquiring the human capital of a pastry chef. 
D)  All of the above could be correct.

Question 3

As a result of their experiment economists Muriel Niederle and Lise Vesterlund found that

Accepted Answer

A)  women choose competitive environments more than men. 
B)  women and men choose competitive environments equally. 
C)  women choose competitive environments less than men. 
D)  women are just as likely as men to have high-paying corporate jobs. 
A)  women choose competitive environments more than men. 
B)  women and men choose competitive environments equally. 
C)  women choose competitive environments less than men. 
D)  women are just as likely as men to have high-paying corporate jobs.

Question 4

In 1913,the Ford Motor Company decided to pay its employees $5 a day.This wage was significantly higher than what any other organization offered.Henry Ford believed that this wage would make his employees happier,increase their productivity,and lower employee turnover.Economists would say that Mr.Ford offered his employees

Accepted Answer

A)  a union. 
B)  an efficiency wage. 
C)  a diminishing rate of marginal return. 
D)  a leisure wage. 
A)  a union. 
B)  an efficiency wage. 
C)  a diminishing rate of marginal return. 
D)  a leisure wage.

Question 5

Politicians often point to wage differentials as evidence of labor market discrimination against ethnic minorities and women.Economists,however,argue against this approach because

Accepted Answer

A)  they don't believe the wage differential really exists. 
B)  they can't agree on a definition of the term "discrimination." 
C)  they believe compensating differentials account for all wage differences. 
D)  different people may have different wages for reasons unrelated to discrimination. 
A)  they don't believe the wage differential really exists. 
B)  they can't agree on a definition of the term "discrimination." 
C)  they believe compensating differentials account for all wage differences. 
D)  different people may have different wages for reasons unrelated to discrimination.

Question 6

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 7

Working in a slaughterhouse is much riskier and more unpleasant than working in a bookstore.As a result,we'd expect a difference in wages between the two jobs.The difference is known as

Accepted Answer

A)  an efficiency wage. 
B)  a compensating differential. 
C)  a wage adjustment. 
D)  a minimum wage. 
A)  an efficiency wage. 
B)  a compensating differential. 
C)  a wage adjustment. 
D)  a minimum wage.

Question 8

Many kindergarten teachers have advanced education degrees,yet they have lower average earnings than other individuals with similar education levels.A potential explanation for the differences in earnings is that kindergarten teachers

Accepted Answer

A)  have more pleasant working conditions. 
B)  have less pleasant working conditions. 
C)  work longer hours. 
D)  must pass certification tests. 
A)  have more pleasant working conditions. 
B)  have less pleasant working conditions. 
C)  work longer hours. 
D)  must pass certification tests.

Question 9

Of the theories listed below,which do the best job of explaining why educated people are paid more than uneducated people?

Accepted Answer

A)  human-capital and price-fixing 
B)  human-capital and signaling 
C)  wage-differential and derived-demand 
D)  cost-allocation and compensating differentials 
A)  human-capital and price-fixing 
B)  human-capital and signaling 
C)  wage-differential and derived-demand 
D)  cost-allocation and compensating differentials

Question 10

Human capital refers to the physical tools and equipment that workers use on their jobs to enhance their productivity.

Accepted Answer

A) True 
 B)False

Question 11

Suppose that a college student receives an offer for a summer internship with a stock brokerage firm.Unfortunately for the student,the internship is unpaid.Is it ever economically beneficial to accept an unpaid job?

Accepted Answer

A)  Yes, because the experience gained during the internship would increase the student's human capital. 
B)  No, because the opportunity cost is too high. 
C)  No, because the student is signaling to future employers that he or she is willing to accept low wages. 
D)  Yes, because accepting an unpaid job signals to future employers that the student has stable personal finances. 
A)  Yes, because the experience gained during the internship would increase the student's human capital. 
B)  No, because the opportunity cost is too high. 
C)  No, because the student is signaling to future employers that he or she is willing to accept low wages. 
D)  Yes, because accepting an unpaid job signals to future employers that the student has stable personal finances.

Question 12

Economists found evidence of discrimination in each of the following markets except

Accepted Answer

A)  1960s baseball games 
B)  baseball cards 
C)  live basketball games in the 1980s 
D)  current era baseball games 
A)  1960s baseball games 
B)  baseball cards 
C)  live basketball games in the 1980s 
D)  current era baseball games

Question 13

Which of these instances would constitute labor-market discrimination? Traci and Carol are identical in all of their labor-market characteristics except that Traci earns a higher salary than Carol because

Accepted Answer

A)  Traci is beautiful and Carol is not. 
B)  Traci is 40 years old and Carol is 60 years old. 
C)  Traci works the night shift and Carol works the day shift. 
D)  Traci has 15 years of experience and Carol has 10 years of experience. 
A)  Traci is beautiful and Carol is not. 
B)  Traci is 40 years old and Carol is 60 years old. 
C)  Traci works the night shift and Carol works the day shift. 
D)  Traci has 15 years of experience and Carol has 10 years of experience.

Question 14

As a summer job,some teenagers choose to detassle corn,a job requiring long hours walking corn fields in the summer heat.Other teens take jobs working as lifeguards.Given that detassling corn is a more difficult job than working as a lifeguard,we would expect a difference in wages between the two jobs.This difference is known as

Accepted Answer

A)  an efficiency wage. 
B)  a compensating differential. 
C)  a wage adjustment. 
D)  a minimum wage. 
A)  an efficiency wage. 
B)  a compensating differential. 
C)  a wage adjustment. 
D)  a minimum wage.

Question 15

Which of the following is not an example of a compensating differential? Job A pays more than Job B because Job A requires

Accepted Answer

A)  more international travel to dangerous locations. 
B)  two night shifts per month. 
C)  careful handling of toxic chemicals. 
D)  an advanced degree. 
A)  more international travel to dangerous locations. 
B)  two night shifts per month. 
C)  careful handling of toxic chemicals. 
D)  an advanced degree.

Question 16

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 17

Daryn earns a higher salary than his friend Nick because Daryn is willing to work on the loading dock,whereas Nick prefers to work in an air-conditioned office.The difference in salary could illustrate a compensating differential.

Accepted Answer

A) True 
 B)False

Question 18

Efficiency wages will raise the quantity of labor supplied to the market.

Accepted Answer

A) True 
 B)False

Question 19

According to the superstar phenomenon,the most talented person in the following occupations is likely to earn extremely high wages except

Accepted Answer

A)  an author. 
B)  an auto mechanic. 
C)  a singer. 
D)  an advice columnist. 
A)  an author. 
B)  an auto mechanic. 
C)  a singer. 
D)  an advice columnist.

Question 20

The superstar phenomenon applies to

Accepted Answer

A)  all famous people equally. 
B)  workers receiving a compensating wage differential. 
C)  markets where technology allows the best producer to supply every customer at a low cost. 
D)  markets where a small group of workers produce a much higher quality product than the average worker. 
A)  all famous people equally. 
B)  workers receiving a compensating wage differential. 
C)  markets where technology allows the best producer to supply every customer at a low cost. 
D)  markets where a small group of workers produce a much higher quality product than the average worker.

The statement that "coal miners are paid more than workers with similar levels of education" is likely to reflect the fact that

Bill and Hillary both work for the same bakery.Bill is an expert pastry chef who begins baking at 4a.m.Hillary is a bookkeeper who works a regular 9-5 work day.Bill earns twice as much as Hillary.Which of the following could explain the higher wages that Bill earns?

As a result of their experiment economists Muriel Niederle and Lise Vesterlund found that

Politicians often point to wage differentials as evidence of labor market discrimination against ethnic minorities and women.Economists,however,argue against this approach because

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

Working in a slaughterhouse is much riskier and more unpleasant than working in a bookstore.As a result,we'd expect a difference in wages between the two jobs.The difference is known as

Many kindergarten teachers have advanced education degrees,yet they have lower average earnings than other individuals with similar education levels.A potential explanation for the differences in earnings is that kindergarten teachers

Of the theories listed below,which do the best job of explaining why educated people are paid more than uneducated people?

Human capital refers to the physical tools and equipment that workers use on their jobs to enhance their productivity.

Suppose that a college student receives an offer for a summer internship with a stock brokerage firm.Unfortunately for the student,the internship is unpaid.Is it ever economically beneficial to accept an unpaid job?

Economists found evidence of discrimination in each of the following markets except

Which of these instances would constitute labor-market discrimination? Traci and Carol are identical in all of their labor-market characteristics except that Traci earns a higher salary than Carol because

Which of the following is not an example of a compensating differential? Job A pays more than Job B because Job A requires

The return to investment in human capital is observed

Daryn earns a higher salary than his friend Nick because Daryn is willing to work on the loading dock,whereas Nick prefers to work in an air-conditioned office.The difference in salary could illustrate a compensating differential.

Efficiency wages will raise the quantity of labor supplied to the market.

According to the superstar phenomenon,the most talented person in the following occupations is likely to earn extremely high wages except

The superstar phenomenon applies 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.

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 Market For the Factors of Production.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

Filters

Exam 19: Earnings and Discrimination.

The statement that "coal miners are paid more than workers with similar levels of education" is likely to reflect the fact that

Bill and Hillary both work for the same bakery.Bill is an expert pastry chef who begins baking at 4a.m.Hillary is a bookkeeper who works a regular 9-5 work day.Bill earns twice as much as Hillary.Which of the following could explain the higher wages that Bill earns?

As a result of their experiment economists Muriel Niederle and Lise Vesterlund found that

Politicians often point to wage differentials as evidence of labor market discrimination against ethnic minorities and women.Economists,however,argue against this approach because

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

Working in a slaughterhouse is much riskier and more unpleasant than working in a bookstore.As a result,we'd expect a difference in wages between the two jobs.The difference is known as

Many kindergarten teachers have advanced education degrees,yet they have lower average earnings than other individuals with similar education levels.A potential explanation for the differences in earnings is that kindergarten teachers

Of the theories listed below,which do the best job of explaining why educated people are paid more than uneducated people?

Human capital refers to the physical tools and equipment that workers use on their jobs to enhance their productivity.

Suppose that a college student receives an offer for a summer internship with a stock brokerage firm.Unfortunately for the student,the internship is unpaid.Is it ever economically beneficial to accept an unpaid job?

Economists found evidence of discrimination in each of the following markets except

Which of these instances would constitute labor-market discrimination? Traci and Carol are identical in all of their labor-market characteristics except that Traci earns a higher salary than Carol because

Which of the following is not an example of a compensating differential? Job A pays more than Job B because Job A requires

The return to investment in human capital is observed

Daryn earns a higher salary than his friend Nick because Daryn is willing to work on the loading dock,whereas Nick prefers to work in an air-conditioned office.The difference in salary could illustrate a compensating differential.

Efficiency wages will raise the quantity of labor supplied to the market.

According to the superstar phenomenon,the most talented person in the following occupations is likely to earn extremely high wages except

The superstar phenomenon applies 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.

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 Market For the Factors of Production.

Income Inequality and Poverty.

The Theory of Consumer Choice.

Frontiers in Microeconomics.

Filters