Question 1

Which of the following is the most likely result of efficiency wages?

Accepted Answer

A) reduced labour-force participation rates 
B) reduced natural rate of unemployment 
C) reduced incentive to shirk 
D) increased worker turnover 
A) reduced labour-force participation rates 
B) reduced natural rate of unemployment 
C) reduced incentive to shirk 
D) increased worker turnover

Question 2

Dan decides to hire some additional workers for his golf-ball factory. The equilibrium wage is $12 per hour. What does efficiency wage theory suggest that it is reasonable for Dan to offer?

Accepted Answer

A) $12 per hour 
B) less than $12 per hour, since some people would be willing to work for less 
C) enough to attract the number of applicants necessary to fill the jobs available 
D) more than $12 per hour, so as to attract a better pool of applicants 
A) $12 per hour 
B) less than $12 per hour, since some people would be willing to work for less 
C) enough to attract the number of applicants necessary to fill the jobs available 
D) more than $12 per hour, so as to attract a better pool of applicants

Question 3

What fraction of the unemployed persons have been unemployed for less than a month?

Accepted Answer

A) 4/5 
B) 3/4 
C) 2/3 
D) 1/3 
A) 4/5 
B) 3/4 
C) 2/3 
D) 1/3

Question 4

When a union bargains successfully with employers, what happens to quantity of labour supplied and demanded in that industry?

Accepted Answer

A) Both the quantity of labour supplied and the quantity of labour demanded increase. 
B) Both the quantity of labour supplied and the quantity of labour demanded decrease. 
C) The quantity of labour supplied increases and the quantity of labour demanded decreases. 
D) The quantity of labour supplied increases the quantity of labour demanded decreases. 
A) Both the quantity of labour supplied and the quantity of labour demanded increase. 
B) Both the quantity of labour supplied and the quantity of labour demanded decrease. 
C) The quantity of labour supplied increases and the quantity of labour demanded decreases. 
D) The quantity of labour supplied increases the quantity of labour demanded decreases.

Question 5

Suppose that consumers decide to buy more computers and fewer typewriters. As a result, computer companies expand production while typewriter companies lay off workers. What is this an example of?

Accepted Answer

A) structural unemployment created by efficiency wages 
B) cyclical unemployment created by a recession 
C) frictional unemployment created by a sectoral shift in demand 
D) frictional unemployment created by a sectoral shift in supply 
A) structural unemployment created by efficiency wages 
B) cyclical unemployment created by a recession 
C) frictional unemployment created by a sectoral shift in demand 
D) frictional unemployment created by a sectoral shift in supply

Question 6

Four employers have justified their actions as follows. Whose logic is inconsistent with the logic of efficiency wage theory?

Accepted Answer

A) Jay develops a new assembly line technology that limits the amount of shirking workers may do, so he reduces what he pays his employees so as to make it closer to the equilibrium wage. 
B) Kay pays her workers less than the equilibrium wage so they won't have the time or money to look for work somewhere else. 
C) Ray pays his workers in a developing country more than the going wage, hoping that they will get a better diet and so be more productive. 
D) Ms. Fay pays her workers the market wages, but she hires more supervisors to make sure workers do not shirk. 
A) Jay develops a new assembly line technology that limits the amount of shirking workers may do, so he reduces what he pays his employees so as to make it closer to the equilibrium wage. 
B) Kay pays her workers less than the equilibrium wage so they won't have the time or money to look for work somewhere else. 
C) Ray pays his workers in a developing country more than the going wage, hoping that they will get a better diet and so be more productive. 
D) Ms. Fay pays her workers the market wages, but she hires more supervisors to make sure workers do not shirk.

Which of the following is the most likely result of efficiency wages?

Dan decides to hire some additional workers for his golf-ball factory. The equilibrium wage is $12 per hour. What does efficiency wage theory suggest that it is reasonable for Dan to offer?

What fraction of the unemployed persons have been unemployed for less than a month?

When a union bargains successfully with employers, what happens to quantity of labour supplied and demanded in that industry?

Suppose that consumers decide to buy more computers and fewer typewriters. As a result, computer companies expand production while typewriter companies lay off workers. What is this an example of?

Four employers have justified their actions as follows. Whose logic is inconsistent with the logic of efficiency wage theory?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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Exam 9: Unemployment and Its Natural Rate

Which of the following is the most likely result of efficiency wages?

Dan decides to hire some additional workers for his golf-ball factory. The equilibrium wage is $12 per hour. What does efficiency wage theory suggest that it is reasonable for Dan to offer?

What fraction of the unemployed persons have been unemployed for less than a month?

When a union bargains successfully with employers, what happens to quantity of labour supplied and demanded in that industry?

Suppose that consumers decide to buy more computers and fewer typewriters. As a result, computer companies expand production while typewriter companies lay off workers. What is this an example of?

Four employers have justified their actions as follows. Whose logic is inconsistent with the logic of efficiency wage theory?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

Filters