Question 1

Other things equal, assume consumer demand for children's toys increases. The result is a(n):

Accepted Answer

A)  rightward shift in the market demand for labor curve in the toy industry. 
B)  increase in the marginal revenue product of firms in the toy industry. 
C)  increase in derived demand for workers in the toy industry. 
D)  all of the above. 
A)  rightward shift in the market demand for labor curve in the toy industry. 
B)  increase in the marginal revenue product of firms in the toy industry. 
C)  increase in derived demand for workers in the toy industry. 
D)  all of the above. D

Question 2

Medicaid is an example of a cash assistance poverty program.

Accepted Answer

A) True 
 B)False  False

Question 3

Exhibit 10-6  Demand for labor curves   In Exhibit 10-6, which of the following could have caused the shift in labor demand from D1 to D2?

Accepted Answer

A)  Increase in wages. 
B)  Decrease in wages. 
C)  Decrease in price of product. 
D)  Decrease in demand for the product. 
E)  Increase in the demand for the product. 
A)  Increase in wages. 
B)  Decrease in wages. 
C)  Decrease in price of product. 
D)  Decrease in demand for the product. 
E)  Increase in the demand for the product. E

Question 4

Which of the following statements is correct ?

Accepted Answer

A)  About 25 percent of the U.S. population earns an income below the poverty line. 
B)  About 50 percent of blacks earn an income below the poverty line. 
C)  Since 1980 the fraction of persons below the poverty level has risen sharply. 
D)  None of the above. 
A)  About 25 percent of the U.S. population earns an income below the poverty line. 
B)  About 50 percent of blacks earn an income below the poverty line. 
C)  Since 1980 the fraction of persons below the poverty level has risen sharply. 
D)  None of the above.

Question 5

The demand for labor is:

Accepted Answer

A)  derived demand. 
B)  featherbedding demand. 
C)  marginal utility demand. 
D)  all of the above. 
A)  derived demand. 
B)  featherbedding demand. 
C)  marginal utility demand. 
D)  all of the above.

Question 6

Exhibit 10-4  Sally's labor supply data   In Exhibit 10-4, if Sally can produce 2 units of output for every hour that she works, then:

Accepted Answer

A)  she will earn a wage of $50. 
B)  she is not productive enough to be hired at all. 
C)  her MRP is less than her wage. 
D)  she will work 30 hours. 
E)  her wage cannot be determined. 
A)  she will earn a wage of $50. 
B)  she is not productive enough to be hired at all. 
C)  her MRP is less than her wage. 
D)  she will work 30 hours. 
E)  her wage cannot be determined.

Question 7

In a competitive labor market a firm will continue to employ workers for as long as an additional worker's marginal revenue product exceeds the wage rate.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following are not counted when we compare a family's income to the poverty line?

Accepted Answer

A)  In-kind transfers such as food stamps, Medicaid, and public housing. 
B)  Cash welfare payments such as from social security. 
C)  Cash payments when a worker becomes unemployed. 
D)  Both a. and b. above are correct. 
A)  In-kind transfers such as food stamps, Medicaid, and public housing. 
B)  Cash welfare payments such as from social security. 
C)  Cash payments when a worker becomes unemployed. 
D)  Both a. and b. above are correct.

Question 9

Which of the following are not counted when we compare a family's income to the poverty line?

Accepted Answer

A)  In-kind transfers such as food stamps, Medicaid, and public housing. 
B)  Cash welfare payments such as from social security. 
C)  Cash payments when a worker becomes unemployed. 
D)  Both a. and b. above are correct. 
A)  In-kind transfers such as food stamps, Medicaid, and public housing. 
B)  Cash welfare payments such as from social security. 
C)  Cash payments when a worker becomes unemployed. 
D)  Both a. and b. above are correct.

Question 10

The social security tax is called FICA, which stands for:

Accepted Answer

A)  Federal Investment Corporation of America. 
B)  Federal Income Contributions to Americans. 
C)  Funding from Individuals and Corporations in America. 
D)  Federal Insurance Contributions Act. 
A)  Federal Investment Corporation of America. 
B)  Federal Income Contributions to Americans. 
C)  Funding from Individuals and Corporations in America. 
D)  Federal Insurance Contributions Act.

Question 11

Exhibit 10-1  Labor and output data   In Exhibit 10-1, if product price is fixed at $8, the MRP of the 2nd worker is equal to:

Accepted Answer

A)  $25. 
B)  $125. 
C)  $200. 
D)  $175. 
E)  $45. 
A)  $25. 
B)  $125. 
C)  $200. 
D)  $175. 
E)  $45.

Question 12

If a union is able to successfully lobby Congress to limit imports of rival products, and thus to raise the demand (and thus price) for goods or services they make, then which of the following best describes the outcome?

Accepted Answer

A)  The supply of labor will increase. 
B)  The demand for labor will increase. 
C)  The supply of labor will decrease. 
D)  The demand for labor will decrease. 
A)  The supply of labor will increase. 
B)  The demand for labor will increase. 
C)  The supply of labor will decrease. 
D)  The demand for labor will decrease.

Question 13

Since 1959 the fraction of persons below the poverty line has fallen.

Accepted Answer

A) True 
 B)False

Question 14

Exhibit 10-5  A perfectly competitive labor market   In Exhibit 10-5, at what wage rate will the firms hire these workers?

Accepted Answer

A)  $25.00 
B)  $20.00 
C)  $15.00 
D)  $10.00 
A)  $25.00 
B)  $20.00 
C)  $15.00 
D)  $10.00

Question 15

Describe the two basic strategies of unions in increasing wage rates for their members.

Accepted Answer

Increasing demand or decreasing supply o

Question 16

The demand for labor curve is identical to the:

Accepted Answer

A)  total wage cost curve. 
B)  marginal resource curve. 
C)  total revenue curve. 
D)  marginal revenue product curve. 
E)  marginal revenue curve. 
A)  total wage cost curve. 
B)  marginal resource curve. 
C)  total revenue curve. 
D)  marginal revenue product curve. 
E)  marginal revenue curve.

Question 17

Which of the following is not included in census income?

Accepted Answer

A)  wages and salaries. 
B)  property income. 
C)  cash welfare benefits. 
D)  in-kind transfers. 
A)  wages and salaries. 
B)  property income. 
C)  cash welfare benefits. 
D)  in-kind transfers.

Question 18

In a competitive labor market, the demand for labor X that produces product Y will increase if the demand for product Y increases.

Accepted Answer

A) True 
 B)False

Question 19

If the MRP is less than the wage, the firm should hire more labor.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is a result of discrimination?

Accepted Answer

A)  Two groups of workers earning different wages. 
B)  Two groups of workers paid the same wage, but proportionally fewer of one group are employed. 
C)  Equal pay and equal employment opportunities for two groups of workers with different productivities. 
D)  No workers from a particular group are employed. 
A)  Two groups of workers earning different wages. 
B)  Two groups of workers paid the same wage, but proportionally fewer of one group are employed. 
C)  Equal pay and equal employment opportunities for two groups of workers with different productivities. 
D)  No workers from a particular group are employed.

Exam 10: Labor Markets and Income Distribution

Other things equal, assume consumer demand for children's toys increases. The result is a(n):

Medicaid is an example of a cash assistance poverty program.

Exhibit 10-6 Demand for labor curves In Exhibit 10-6, which of the following could have caused the shift in labor demand from D1 to D2?

Which of the following statements is correct ?

The demand for labor is:

Exhibit 10-4 Sally's labor supply data In Exhibit 10-4, if Sally can produce 2 units of output for every hour that she works, then:

In a competitive labor market a firm will continue to employ workers for as long as an additional worker's marginal revenue product exceeds the wage rate.

Which of the following are not counted when we compare a family's income to the poverty line?

Which of the following are not counted when we compare a family's income to the poverty line?

The social security tax is called FICA, which stands for:

Exhibit 10-1 Labor and output data In Exhibit 10-1, if product price is fixed at $8, the MRP of the 2nd worker is equal to:

If a union is able to successfully lobby Congress to limit imports of rival products, and thus to raise the demand (and thus price) for goods or services they make, then which of the following best describes the outcome?

Since 1959 the fraction of persons below the poverty line has fallen.

Exhibit 10-5 A perfectly competitive labor market In Exhibit 10-5, at what wage rate will the firms hire these workers?

Describe the two basic strategies of unions in increasing wage rates for their members.

The demand for labor curve is identical to the:

Which of the following is not included in census income?

In a competitive labor market, the demand for labor X that produces product Y will increase if the demand for product Y increases.

If the MRP is less than the wage, the firm should hire more labor.

Which of the following is a result of discrimination?

Introducing the Economic Way of Thinking

Production Possibilities, Opportunity Cost, and Economic Growth

Market Demand and Supply

Markets in Action

Price Elasticity of Demand

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gross Domestic Product

Business Cycles and Unemployment

Inflation

Aggregate Demand and Supply

Fiscal Policy

The Public Sector

Federal Deficits, Surpluses, and the National Debt

Money and the Federal Reserve System

Money Creation

Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model

International Trade and Finance

Economies in Transition

Growth and the Less-Developed Countries

Filters

Exhibit 10-6 Demand for labor curves In Exhibit 10-6, which of the following could have caused the shift in labor demand from D₁ to D₂?