Question 1

A decision to supply labor or not to supply it is also a decision to

Accepted Answer

A) earn the highest possible wage. 
B) demand or forgo a certain amount of leisure. 
C) be as productive as possible. 
D) join the union. 
A) earn the highest possible wage. 
B) demand or forgo a certain amount of leisure. 
C) be as productive as possible. 
D) join the union.

Question 2

Unions often have the power to push wages above competitive levels.

Accepted Answer

A) True 
 B)False

Question 3

Most collective bargaining situations lead to strikes.

Accepted Answer

A) True 
 B)False

Question 4

Union membership was relatively low during the Great Depression.

Accepted Answer

A) True 
 B)False

Question 5

Explain how a bilateral monopoly equilibrium outcome differs from a purely competitive outcome.

Accepted Answer

In pure competition, there are so many s

Question 6

Unions can be thought of as constituting

Accepted Answer

A) a monopoly element in the supply of labor. 
B) a monopoly element in the demand for labor. 
C) an oligopoly element in the supply of labor. 
D) a competitive element in the demand for labor. 
A) a monopoly element in the supply of labor. 
B) a monopoly element in the demand for labor. 
C) an oligopoly element in the supply of labor. 
D) a competitive element in the demand for labor.

Question 7

Labor markets are generally perfectly competitive markets.

Accepted Answer

A) True 
 B)False

Question 8

College graduates now earn nearly five times as much as their high school-educated peers but the gap is falling.

Accepted Answer

A) True 
 B)False

Question 9

In the collective bargaining process

Accepted Answer

A) supply and demand analysis is used to determine the wage. 
B) the contract can legally cover only the wage or salary determined. 
C) there is often heated discussion with threats of strikes and counterthreats of lockout. 
D) the negotiation period is limited to thirty days. 
A) supply and demand analysis is used to determine the wage. 
B) the contract can legally cover only the wage or salary determined. 
C) there is often heated discussion with threats of strikes and counterthreats of lockout. 
D) the negotiation period is limited to thirty days.

Question 10

According to the process of creative destruction, at first the entrepreneur will be able to sell her product for

Accepted Answer

A) a low price because it is not well known. 
B) a high price because there is no competition. 
C) a fair price because these are contestable markets. 
D) at a price of zero until the market is created. 
A) a low price because it is not well known. 
B) a high price because there is no competition. 
C) a fair price because these are contestable markets. 
D) at a price of zero until the market is created.

Question 11

The percentage of work time lost due to strikes is greater than the percentage of work time lost due to coffee breaks.

Accepted Answer

A) True 
 B)False

Question 12

The Industrial Revolution refers to the period 1950-1970, which was characterized by rapid manufacturing sector growth in the United States.

Accepted Answer

A) True 
 B)False

Question 13

Explain the theory of investment in human capital and the specific role that education plays in the theory.

Accepted Answer

The central view of human capital theory

Question 14

Less than 13 percent of U.S.workers belong to unions.

Accepted Answer

A) True 
 B)False

Question 15

Increased productivity of workers in manufacturing has

Accepted Answer

A) increased employment in manufacturing. 
B) increased employment in agriculture. 
C) decreased employment in agriculture. 
D) decreased employment in services. 
E) increased employment in services. 
A) increased employment in manufacturing. 
B) increased employment in agriculture. 
C) decreased employment in agriculture. 
D) decreased employment in services. 
E) increased employment in services.

Question 16

Suppose the goal of a union is to maximize the total income of all workers it represents.In this case it will probably aim for a wage at which the elasticity of demand for workers is

Accepted Answer

A) 0. 
B) infinite. 
C) 1. 
D) ranging from 2 to 5. 
A) 0. 
B) infinite. 
C) 1. 
D) ranging from 2 to 5.

Question 17

The story of innovation battles among firms is analogous to the story of armaments races among countries.

Accepted Answer

A) True 
 B)False

Question 18

Invention cannot be successful financially if price is

Accepted Answer

A) greater than marginal cost because invention is based largely on social costs. 
B) greater than marginal cost because invention is based solely on external costs. 
C) equal to marginal cost because invention is based largely on variable costs. 
D) equal to marginal cost because invention is based largely on fixed costs. 
A) greater than marginal cost because invention is based largely on social costs. 
B) greater than marginal cost because invention is based solely on external costs. 
C) equal to marginal cost because invention is based largely on variable costs. 
D) equal to marginal cost because invention is based largely on fixed costs.

Question 19

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 20

What are the two characteristics that are essential to economic analysis of invention?

Accepted Answer

A) fixed-costs and public goods 
B) fixed-costs and private goods 
C) variable-costs and public goods 
D) variable-costs and private goods 
A) fixed-costs and public goods 
B) fixed-costs and private goods 
C) variable-costs and public goods 
D) variable-costs and private goods

Exam 19: Labor and Entrepreneurship: the Human Inputs

A decision to supply labor or not to supply it is also a decision to

Unions often have the power to push wages above competitive levels.

Most collective bargaining situations lead to strikes.

Union membership was relatively low during the Great Depression.

Explain how a bilateral monopoly equilibrium outcome differs from a purely competitive outcome.

Unions can be thought of as constituting

Labor markets are generally perfectly competitive markets.

College graduates now earn nearly five times as much as their high school-educated peers but the gap is falling.

In the collective bargaining process

According to the process of creative destruction, at first the entrepreneur will be able to sell her product for

The percentage of work time lost due to strikes is greater than the percentage of work time lost due to coffee breaks.

The Industrial Revolution refers to the period 1950-1970, which was characterized by rapid manufacturing sector growth in the United States.

Explain the theory of investment in human capital and the specific role that education plays in the theory.

Less than 13 percent of U.S.workers belong to unions.

Increased productivity of workers in manufacturing has

Suppose the goal of a union is to maximize the total income of all workers it represents.In this case it will probably aim for a wage at which the elasticity of demand for workers is

The story of innovation battles among firms is analogous to the story of armaments races among countries.

Invention cannot be successful financially if price is

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

What are the two characteristics that are essential to economic analysis of invention?

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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