Question 1

What does the term "compensating differential" refer to

Accepted Answer

A) the fact that workers that do similar work should be paid the same wage 
B) the fact that some workers live farther from their jobs than do other workers 
C) a wage difference that is based on monetary characteristics 
D) a wage difference that is provided to offset the nonmonetary characteristics of different jobs 
A) the fact that workers that do similar work should be paid the same wage 
B) the fact that some workers live farther from their jobs than do other workers 
C) a wage difference that is based on monetary characteristics 
D) a wage difference that is provided to offset the nonmonetary characteristics of different jobs

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

What have studies shown about the earnings of union workers

Accepted Answer

A) They earn about 30 to 40 percent less than nonunion workers. 
B) They earn about 10 to 20 percent less than nonunion workers. 
C) They earn about 10 to 20 percent more than nonunion workers. 
D) They earn about 30 to 40 percent more than nonunion workers. 
A) They earn about 30 to 40 percent less than nonunion workers. 
B) They earn about 10 to 20 percent less than nonunion workers. 
C) They earn about 10 to 20 percent more than nonunion workers. 
D) They earn about 30 to 40 percent more than nonunion workers.

Question 4

Which theory would suggest that attending school does not improve productivity,but that high-ability people are more likely to stay in school

Accepted Answer

A) physical-capital theory 
B) human-capital theory 
C) signalling theory 
D) neoclassical theory 
A) physical-capital theory 
B) human-capital theory 
C) signalling theory 
D) neoclassical theory

Question 5

To what extend can we use differences in human capital to explain wage differentials

Accepted Answer

A) they are unrelated to wage rate differences across gender classifications, since both men and women are required to complete requirements for a high school diploma. 
B) they are most helpful in explaining age discrimination, but unhelpful in explaining discrimination on the basis of ethnicity. 
C) they explain some of the difference in average wage rates across age classifications. 
D) they explain all of the difference in average wage rates across gender classifications. 
A) they are unrelated to wage rate differences across gender classifications, since both men and women are required to complete requirements for a high school diploma. 
B) they are most helpful in explaining age discrimination, but unhelpful in explaining discrimination on the basis of ethnicity. 
C) they explain some of the difference in average wage rates across age classifications. 
D) they explain all of the difference in average wage rates across gender classifications.

Question 6

If unskilled labour is relatively plentiful and cheap in many foreign countries,then as Canada expands its trade with these foreign countries,what happens to the domestic demand for unskilled and skilled labour

Accepted Answer

A) The domestic demand for unskilled labour will rise and demand for skilled labour will fall. 
B) The domestic demand for skilled labour will rise and demand for unskilled labour will fall. 
C) The domestic demand for both skilled and unskilled labour will rise proportionately. 
D) The domestic demand for both skilled and unskilled labour will be unaffected, assuming there are no barriers to free trade. 
A) The domestic demand for unskilled labour will rise and demand for skilled labour will fall. 
B) The domestic demand for skilled labour will rise and demand for unskilled labour will fall. 
C) The domestic demand for both skilled and unskilled labour will rise proportionately. 
D) The domestic demand for both skilled and unskilled labour will be unaffected, assuming there are no barriers to free trade.

Question 7

Wayne Gretzky earned much more during his NHL career than a university professor would earn.What would the neoclassical theory of labour markets suggest

Accepted Answer

A) Wayne Gretzky was overpaid as a hockey player. 
B) Wayne Gretzky was more valued by society than a university professor. 
C) Wayne Gretzky is the greatest hockey player of all time. 
D) Wayne Gretzky has contributed more to the economy's production of goods and services than a university professor. 
A) Wayne Gretzky was overpaid as a hockey player. 
B) Wayne Gretzky was more valued by society than a university professor. 
C) Wayne Gretzky is the greatest hockey player of all time. 
D) Wayne Gretzky has contributed more to the economy's production of goods and services than a university professor.

Question 8

It is increasingly clear that technological change,rather than international trade,has been largely responsible for an expanding wage gap between high-skill and low-skill workers.

Accepted Answer

A) True 
 B)False

Question 9

Sophie receives a higher wage than Justin.Which of these instances would be one of labour-market discrimination,given the definition of that term and assuming Sophie and Justin are identical in all other labour-market characteristics

Accepted Answer

A) Sophie is a university graduate and Justin has only a high-school diploma. 
B) Sophie is a woman and Justin is a man. 
C) Sophie has 15 years of experience at her job; Justin has only 5 years of experience. 
D) Sophie is more productive than Justin. 
A) Sophie is a university graduate and Justin has only a high-school diploma. 
B) Sophie is a woman and Justin is a man. 
C) Sophie has 15 years of experience at her job; Justin has only 5 years of experience. 
D) Sophie is more productive than Justin.

Question 10

What theory of education states that a university degree makes a person more productive

Accepted Answer

A) the compensating-differential theory of education 
B) the human-capital theory of education 
C) the signalling theory of education 
D) the natural-ability theory of education 
A) the compensating-differential theory of education 
B) the human-capital theory of education 
C) the signalling theory of education 
D) the natural-ability theory of education

Question 11

Consumers are often a primary source of discrimination in labour markets.

Accepted Answer

A) True 
 B)False

Question 12

Park wardens at Banff National Park are known to have relatively low wages.What is likely to be a partial explanation

Accepted Answer

A) Park wardens are often part-time university students. 
B) Park wardens don't need much money to live. 
C) Park warden jobs are perceived to be dangerous. 
D) Park warden jobs are perceived to be fun. 
A) Park wardens are often part-time university students. 
B) Park wardens don't need much money to live. 
C) Park warden jobs are perceived to be dangerous. 
D) Park warden jobs are perceived to be fun.

Question 13

Which statement best represents the idea behind signalling in education

Accepted Answer

A) Education can turn an unproductive person into a productive person. 
B) Most university graduates wouldn't be half as productive if it were not for the years they spend in the classroom. 
C) The more naturally productive someone is, the more they are inclined to educate themselves. 
D) Some schools turn out more productive students than others. 
A) Education can turn an unproductive person into a productive person. 
B) Most university graduates wouldn't be half as productive if it were not for the years they spend in the classroom. 
C) The more naturally productive someone is, the more they are inclined to educate themselves. 
D) Some schools turn out more productive students than others.

Question 14

Professional underwater divers are known to have high wages and work an average of only 20 hours a week.What is likely a partial explanation

Accepted Answer

A) The job is likely to be very dull. 
B) The job is likely to be fun. 
C) The job is likely to be very dangerous. 
D) The job is very competitive. 
A) The job is likely to be very dull. 
B) The job is likely to be fun. 
C) The job is likely to be very dangerous. 
D) The job is very competitive.

Question 15

Which conclusion does the fact that wage differentials continue to exist across different groups of workers lead economists to believe

Accepted Answer

A) Discrimination is in fact a very large economic problem. 
B) Differences in human capital and job characteristics must be important in explaining the differences in wages. 
C) Firms apparently are not profit maximizers. 
D) The market has failed to properly allocate wages to different workers. 
A) Discrimination is in fact a very large economic problem. 
B) Differences in human capital and job characteristics must be important in explaining the differences in wages. 
C) Firms apparently are not profit maximizers. 
D) The market has failed to properly allocate wages to different workers.

Question 16

What can we say about the evidence regarding differences in average wages of women compared to men

Accepted Answer

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

Question 17

Regarding the possibility of labour-market discrimination,which statement is a consensus view among economists

Accepted Answer

A) All wage differences among groups are attributable to differences in human capital and compensating differentials. 
B) Most wage differences among groups are attributable to discrimination. 
C) Wage differences among groups are not sufficient by themselves to determine how much discrimination there is. 
D) Labour-market discrimination will not exist in the long run. 
A) All wage differences among groups are attributable to differences in human capital and compensating differentials. 
B) Most wage differences among groups are attributable to discrimination. 
C) Wage differences among groups are not sufficient by themselves to determine how much discrimination there is. 
D) Labour-market discrimination will not exist in the long run.

Question 18

What did a series of studies between 1987 and 1995 determine

Accepted Answer

A) Francophone players in the NHL have been subjected to hiring discrimination. 
B) Francophone players in the NHL have not been subjected to hiring discrimination. 
C) Aboriginal players in the NHL have not been subjected to hiring discrimination. 
D) Aboriginal players in the NHL have been subjected to hiring discrimination. 
A) Francophone players in the NHL have been subjected to hiring discrimination. 
B) Francophone players in the NHL have not been subjected to hiring discrimination. 
C) Aboriginal players in the NHL have not been subjected to hiring discrimination. 
D) Aboriginal players in the NHL have been subjected to hiring discrimination.

Question 19

Which view of education is best characterized by the belief that education makes a person more productive and thereby raises his or her wage

Accepted Answer

A) the compensating-differential view of education 
B) the natural-ability view of education 
C) the unmeasured-variables view of education 
D) the human-capital view of education 
A) the compensating-differential view of education 
B) the natural-ability view of education 
C) the unmeasured-variables view of education 
D) the human-capital view of education

Question 20

When competitive labour markets are in equilibrium,what does the neoclassical theory of labour predict

Accepted Answer

A) The distribution of wages across the economy will be bell-shaped. 
B) The wage paid to each worker is equal to that worker's marginal product of labour. 
C) Each worker is paid the value of his/her marginal contribution to the economy. 
D) The minimum wage will be binding. 
A) The distribution of wages across the economy will be bell-shaped. 
B) The wage paid to each worker is equal to that worker's marginal product of labour. 
C) Each worker is paid the value of his/her marginal contribution to the economy. 
D) The minimum wage will be binding.

Exam 19: Earnings and Discrimination

What does the term "compensating differential" refer to

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

What have studies shown about the earnings of union workers

Which theory would suggest that attending school does not improve productivity,but that high-ability people are more likely to stay in school

To what extend can we use differences in human capital to explain wage differentials

If unskilled labour is relatively plentiful and cheap in many foreign countries,then as Canada expands its trade with these foreign countries,what happens to the domestic demand for unskilled and skilled labour

Wayne Gretzky earned much more during his NHL career than a university professor would earn.What would the neoclassical theory of labour markets suggest

It is increasingly clear that technological change,rather than international trade,has been largely responsible for an expanding wage gap between high-skill and low-skill workers.

Sophie receives a higher wage than Justin.Which of these instances would be one of labour-market discrimination,given the definition of that term and assuming Sophie and Justin are identical in all other labour-market characteristics

What theory of education states that a university degree makes a person more productive

Consumers are often a primary source of discrimination in labour markets.

Park wardens at Banff National Park are known to have relatively low wages.What is likely to be a partial explanation

Which statement best represents the idea behind signalling in education

Professional underwater divers are known to have high wages and work an average of only 20 hours a week.What is likely a partial explanation

Which conclusion does the fact that wage differentials continue to exist across different groups of workers lead economists to believe

What can we say about the evidence regarding differences in average wages of women compared to men

Regarding the possibility of labour-market discrimination,which statement is a consensus view among economists

What did a series of studies between 1987 and 1995 determine

Which view of education is best characterized by the belief that education makes a person more productive and thereby raises his or her wage

When competitive labour markets are in equilibrium,what does the neoclassical theory of labour predict

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 Markets for the Factors of Production

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

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