Question 1

The percentage of work time lost due to strikes in the United States has been increasing over time.

Accepted Answer

A) True 
 B)False

Question 2

It has been shown that when offered higher wages, women will work more hours.This is because

Accepted Answer

A) women tend to work more hours than men at any wage rate. 
B) the substitution effect is more dominant for women. 
C) the income effect is more dominant for women. 
D) women are more productive than men at higher wages. 
A) women tend to work more hours than men at any wage rate. 
B) the substitution effect is more dominant for women. 
C) the income effect is more dominant for women. 
D) women are more productive than men at higher wages.

Question 3

Union leaders who focus on increasing the size of their union will generally accept a wage just above the competitive level.

Accepted Answer

A) True 
 B)False

Question 4

Why do firms spend money on costly innovation?

Accepted Answer

A) Competitive markets leave firms no choice but to innovate. 
B) Innovation is a low-risk activity. 
C) Innovation always results in higher profits for firms. 
D) Innovation is usually profitable because the majority of innovations reach the market place. 
E) Because innovation is beneficial for society and firms are motivated to act in ways that are beneficial for society. 
A) Competitive markets leave firms no choice but to innovate. 
B) Innovation is a low-risk activity. 
C) Innovation always results in higher profits for firms. 
D) Innovation is usually profitable because the majority of innovations reach the market place. 
E) Because innovation is beneficial for society and firms are motivated to act in ways that are beneficial for society.

Question 5

It is possible to analyze education decisions in a manner similar to the decision to acquire more

Accepted Answer

A) capital. 
B) leisure. 
C) work. 
D) goods and services. 
A) capital. 
B) leisure. 
C) work. 
D) goods and services.

Question 6

Economists would describe a labor union as a

Accepted Answer

A) trade organization. 
B) necessity for competitive labor markets. 
C) labor monopoly. 
D) pure monopsony. 
A) trade organization. 
B) necessity for competitive labor markets. 
C) labor monopoly. 
D) pure monopsony.

Question 7

For which of the following is there no such thing as a "price"?

Accepted Answer

A) labor 
B) land 
C) entrepreneurship 
D) none of the above 
A) labor 
B) land 
C) entrepreneurship 
D) none of the above

Question 8

Among possible union strategies, the one that can both raise wages and add to employment is

Accepted Answer

A) restricting the supply of workers. 
B) raising the demand curve for the product or for labor. 
C) fixing the wage. 
D) striking frequently. 
A) restricting the supply of workers. 
B) raising the demand curve for the product or for labor. 
C) fixing the wage. 
D) striking frequently.

Question 9

Minimum wage laws usually

Accepted Answer

A) increase the number of unskilled workers who are employed. 
B) benefit all unskilled workers. 
C) raise the wages paid to unskilled workers who are employed. 
D) All of the above are correct. 
A) increase the number of unskilled workers who are employed. 
B) benefit all unskilled workers. 
C) raise the wages paid to unskilled workers who are employed. 
D) All of the above are correct.

Question 10

The majority of new jobs created in the service sector of the U.S.economy have been in the information sector.

Accepted Answer

A) True 
 B)False

Question 11

The human capital model assumes that

Accepted Answer

A) education is a productive investment that raises total output. 
B) education does not change potential productivity, but it does save resources by reducing sorting costs for employers. 
C) the educational system is a very expensive process to legitimize the intergenerational transmission of privileged status. 
D) such factors as the love of learning should be included in the analysis. 
A) education is a productive investment that raises total output. 
B) education does not change potential productivity, but it does save resources by reducing sorting costs for employers. 
C) the educational system is a very expensive process to legitimize the intergenerational transmission of privileged status. 
D) such factors as the love of learning should be included in the analysis.

Question 12

In a famous series of commercials, the International Ladies' Garment Workers Union (ILGWU) urged buyers to "look for the union label" and to avoid buying clothes not made by ILGWU members.Through the commercials, the ILGWU tried to attain its goals by

Accepted Answer

A) restricting the number of ILGWU members. 
B) featherbedding. 
C) raising the marginal revenue products of ILGWU members. 
D) creating lower prices for goods made by ILGWU members. 
A) restricting the number of ILGWU members. 
B) featherbedding. 
C) raising the marginal revenue products of ILGWU members. 
D) creating lower prices for goods made by ILGWU members.

Question 13

Some take issue with the human capital argument that employers pay more for college graduates because firms recognize the value of human capital.What are two alternative explanations for why college grads receive higher pay?

Accepted Answer

Education is a sorting device for factor

Question 14

The number of persons who could become lawyers or surgeons is potentially quite large, yet these two groups earn fairly high incomes.One of the main reasons why they do is the

Accepted Answer

A) return on the investment of many years of training. 
B) evening-out of their low income during schooling. 
C) rent on their unique and rare talents. 
D) scarcity value of their abilities. 
A) return on the investment of many years of training. 
B) evening-out of their low income during schooling. 
C) rent on their unique and rare talents. 
D) scarcity value of their abilities.

Question 15

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 16

Labor unions in the United States

Accepted Answer

A) tend to be more outspoken politically than those in Europe. 
B) have experienced steady declines in membership since the 1950s. 
C) tend to be more powerful in deregulated industries (for example, airlines) than in regulated industries. 
D) universally support socialist principles. 
A) tend to be more outspoken politically than those in Europe. 
B) have experienced steady declines in membership since the 1950s. 
C) tend to be more powerful in deregulated industries (for example, airlines) than in regulated industries. 
D) universally support socialist principles.

Question 17

The wages of professional athletes

Accepted Answer

A) are related to demand for their services. 
B) include substantial economic rents. 
C) are high because of scarcity. 
D) All of the above are true. 
A) are related to demand for their services. 
B) include substantial economic rents. 
C) are high because of scarcity. 
D) All of the above are true.

Question 18

The impact of an increase in oil prices stemming from the growth of demand is probably going to ____ the wages of petroleum engineers.

Accepted Answer

A) decrease 
B) increase 
C) leave unaffected 
D) be impossible to predict 
A) decrease 
B) increase 
C) leave unaffected 
D) be impossible to predict

Question 19

Earnings of some highly skilled or highly specialized persons can be classified as economic rents.

Accepted Answer

A) True 
 B)False

Question 20

Discuss the historic increases and decreases in unionism in the United States and how it affects current labor relations today.

Accepted Answer

Unions are no longer as important as the

Exam 19: Labor and Entrepreneurship: the Human Inputs

The percentage of work time lost due to strikes in the United States has been increasing over time.

It has been shown that when offered higher wages, women will work more hours.This is because

Union leaders who focus on increasing the size of their union will generally accept a wage just above the competitive level.

Why do firms spend money on costly innovation?

It is possible to analyze education decisions in a manner similar to the decision to acquire more

Economists would describe a labor union as a

For which of the following is there no such thing as a "price"?

Among possible union strategies, the one that can both raise wages and add to employment is

Minimum wage laws usually

The majority of new jobs created in the service sector of the U.S.economy have been in the information sector.

The human capital model assumes that

In a famous series of commercials, the International Ladies' Garment Workers Union (ILGWU) urged buyers to "look for the union label" and to avoid buying clothes not made by ILGWU members.Through the commercials, the ILGWU tried to attain its goals by

Some take issue with the human capital argument that employers pay more for college graduates because firms recognize the value of human capital.What are two alternative explanations for why college grads receive higher pay?

The number of persons who could become lawyers or surgeons is potentially quite large, yet these two groups earn fairly high incomes.One of the main reasons why they do is the

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?

Labor unions in the United States

The wages of professional athletes

The impact of an increase in oil prices stemming from the growth of demand is probably going to ____ the wages of petroleum engineers.

Earnings of some highly skilled or highly specialized persons can be classified as economic rents.

Discuss the historic increases and decreases in unionism in the United States and how it affects current labor relations today.

What Is Economics

The Economy: 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

Securities: Business Finance and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

Monopoly

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets: the Price System

The Shortcomings of Free Markets

Externalities, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Poverty, Inequality, and Discrimination

Is Useconomic Leadership Threatened

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

He 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

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