Question 1

If we were to compare the annual earnings of union and nonunion workers in recent years, we would find that

Accepted Answer

A)  unions have not succeeded in raising the annual incomes of their members. 
B)  unions have succeeded in raising the annual incomes of their members. 
C)  the data is incomplete to tell whether unions have been successful in raising the annual income of their members. 
D)  union members have annual incomes substantially below nonunion members. 
A)  unions have not succeeded in raising the annual incomes of their members. 
B)  unions have succeeded in raising the annual incomes of their members. 
C)  the data is incomplete to tell whether unions have been successful in raising the annual income of their members. 
D)  union members have annual incomes substantially below nonunion members.

Question 2

Samuel Gompers served as the first leader of the

Accepted Answer

A)  Knights of Labor. 
B)  American Federation of Labor. 
C)  Congress of Industrial Organizations. 
D)  United Steel Workers. 
A)  Knights of Labor. 
B)  American Federation of Labor. 
C)  Congress of Industrial Organizations. 
D)  United Steel Workers.

Question 3

When it comes to productivity, some economists argue that

Accepted Answer

A)  unions have caused a decrease in productivity by excessive staffing and makework requirements. 
B)  through the use of featherbedding unions have been responsible for productivity increases. 
C)  the passage of the Taft-Hartley Act has led to a significant decrease in productivity. 
D)  the union's insistence on profitability laborsaving devices has led to an increase in productivity. 
A)  unions have caused a decrease in productivity by excessive staffing and makework requirements. 
B)  through the use of featherbedding unions have been responsible for productivity increases. 
C)  the passage of the Taft-Hartley Act has led to a significant decrease in productivity. 
D)  the union's insistence on profitability laborsaving devices has led to an increase in productivity.

Question 4

The United Auto Workers is striking against Ford. The Teamsters refuse to deliver steel to Ford. This is an example of

Accepted Answer

A)  a jurisdictional dispute and is illegal under the Taft-Hartley Act. 
B)  a secondary boycott and is illegal under the Taft-Hartley Act. 
C)  a sympathy strike and is illegal under the Taft-Hartley Act. 
D)  a closed shop and is illegal under the Wagner Act. 
A)  a jurisdictional dispute and is illegal under the Taft-Hartley Act. 
B)  a secondary boycott and is illegal under the Taft-Hartley Act. 
C)  a sympathy strike and is illegal under the Taft-Hartley Act. 
D)  a closed shop and is illegal under the Wagner Act.

Question 5

A right-to-work law makes it illegal

Accepted Answer

A)  to prevent union members from working in any firm. 
B)  to fire a worker who has joined a union or who tries to organize a union at any firm. 
C)  to inquire whether a prospective employee is a member of a union or not. 
D)  for union membership to be a requirement for continued employment in any firm. 
A)  to prevent union members from working in any firm. 
B)  to fire a worker who has joined a union or who tries to organize a union at any firm. 
C)  to inquire whether a prospective employee is a member of a union or not. 
D)  for union membership to be a requirement for continued employment in any firm.

Question 6

The welders' union at Ajax is on strike. The maintenance union has decided to walk out in support of the welders' union. This is known as

Accepted Answer

A)  a closed shop. 
B)  a union shop. 
C)  a sympathy strike. 
D)  a secondary boycott. 
A)  a closed shop. 
B)  a union shop. 
C)  a sympathy strike. 
D)  a secondary boycott.

Question 7

In a monopsonistic market,

Accepted Answer

A)  employment is lower but wages are higher than in a comparable competitive market. 
B)  employment is higher but wages are lower than in a comparable competitive market. 
C)  both employment and wages are higher than in a comparable competitive market. 
D)  both employment and wages are lower than in a comparable competitive market. 
A)  employment is lower but wages are higher than in a comparable competitive market. 
B)  employment is higher but wages are lower than in a comparable competitive market. 
C)  both employment and wages are higher than in a comparable competitive market. 
D)  both employment and wages are lower than in a comparable competitive market.

Question 8

Critics of unions tend to focus on the fact that unions

Accepted Answer

A)  tend to generate higher wages. 
B)  reduce profits. 
C)  are politically active. 
D)  engage in restrictive labor practices. 
A)  tend to generate higher wages. 
B)  reduce profits. 
C)  are politically active. 
D)  engage in restrictive labor practices.

Question 9

Under monopsony, marginal factor cost

Accepted Answer

A)  is downward sloping. 
B)  is less than the wage rate, although it increases as more workers are hired. 
C)  equals the wage rate. 
D)  is greater than the going wage rate. 
A)  is downward sloping. 
B)  is less than the wage rate, although it increases as more workers are hired. 
C)  equals the wage rate. 
D)  is greater than the going wage rate.

Question 10

Under monopsony, marginal factor cost is

Accepted Answer

A)  equal to the wage rate. 
B)  below the wage rate but increases as more workers are hired. 
C)  greater than the wage rate. 
D)  downward sloping. 
A)  equal to the wage rate. 
B)  below the wage rate but increases as more workers are hired. 
C)  greater than the wage rate. 
D)  downward sloping.

Question 11

Labor unions that consist of workers from a particular industry, such as automobile manufacturing, are called

Accepted Answer

A)  craft unions. 
B)  industrial unions. 
C)  collective unions. 
D)  closed unions. 
A)  craft unions. 
B)  industrial unions. 
C)  collective unions. 
D)  closed unions.

Question 12

A disagreement involving two or more unions over which should have control over a particular firm or industry is

Accepted Answer

A)  a closed shop. 
B)  a union shop. 
C)  a jurisdictional dispute. 
D)  an industrial union. 
A)  a closed shop. 
B)  a union shop. 
C)  a jurisdictional dispute. 
D)  an industrial union.

Question 13

Which of the following is FALSE regarding unions?

Accepted Answer

A)  The American Federation of Labor (AFL), composed of craft unions, was formed in 1886 under the leadership of Samuel Gompers. 
B)  For a period after World War I the government temporarily stopped protecting labor's right to organize. 
C)  During the Great Depression, legislation was passed that made collective bargaining illegal. 
D)  The AFL and the CIO merged in 1955. 
A)  The American Federation of Labor (AFL), composed of craft unions, was formed in 1886 under the leadership of Samuel Gompers. 
B)  For a period after World War I the government temporarily stopped protecting labor's right to organize. 
C)  During the Great Depression, legislation was passed that made collective bargaining illegal. 
D)  The AFL and the CIO merged in 1955.

Question 14

Discuss the benefits of unions.

Accepted Answer

Some economists argue that unions probab

Question 15

A jurisdictional dispute is a

Accepted Answer

A)  strike by a union in sympathy with another union's strike or cause. 
B)  dispute involving two or more unions over which should have control of a particular jurisdiction. 
C)  business enterprise in which employees must belong to the union before they can be hired and must remain in the union after they are hired. 
D)  legal environment in which businesses may hire nonunion members conditional on their joining the union by some specified date after employment begins. 
A)  strike by a union in sympathy with another union's strike or cause. 
B)  dispute involving two or more unions over which should have control of a particular jurisdiction. 
C)  business enterprise in which employees must belong to the union before they can be hired and must remain in the union after they are hired. 
D)  legal environment in which businesses may hire nonunion members conditional on their joining the union by some specified date after employment begins.

Question 16

In a bilateral monopoly, the wage rate that is determined in the market

Accepted Answer

A)  is equal to MFC. 
B)  is equal to MRP. 
C)  is indeterminate. 
D)  is the same as in a perfectly competitive market. 
A)  is equal to MFC. 
B)  is equal to MRP. 
C)  is indeterminate. 
D)  is the same as in a perfectly competitive market.

Question 17

Distinguish between a closed shop and a union shop. Are either or both shops legal? Explain.

Accepted Answer

A closed shop is a situation in which a

Question 18

Collective bargaining in the United States typically involves negotiations between

Accepted Answer

A)  the government and management over the minimum wage law. 
B)  the management of a company and the leaders of the union over the wages and fringe benefits to be offered. 
C)  an individual and her boss over the appropriate salary level. 
D)  union and nonunion employees regarding work rules. 
A)  the government and management over the minimum wage law. 
B)  the management of a company and the leaders of the union over the wages and fringe benefits to be offered. 
C)  an individual and her boss over the appropriate salary level. 
D)  union and nonunion employees regarding work rules.

Exam 29: Unions and Labor Market Monopoly Power

If we were to compare the annual earnings of union and nonunion workers in recent years, we would find that

Samuel Gompers served as the first leader of the

When it comes to productivity, some economists argue that

The United Auto Workers is striking against Ford. The Teamsters refuse to deliver steel to Ford. This is an example of

A right-to-work law makes it illegal

The welders' union at Ajax is on strike. The maintenance union has decided to walk out in support of the welders' union. This is known as

In a monopsonistic market,

Critics of unions tend to focus on the fact that unions

Under monopsony, marginal factor cost

Under monopsony, marginal factor cost is

Labor unions that consist of workers from a particular industry, such as automobile manufacturing, are called

A disagreement involving two or more unions over which should have control over a particular firm or industry is

Which of the following is FALSE regarding unions?

Discuss the benefits of unions.

A jurisdictional dispute is a

In a bilateral monopoly, the wage rate that is determined in the market

Distinguish between a closed shop and a union shop. Are either or both shops legal? Explain.

Collective bargaining in the United States typically involves negotiations between

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

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The Macroeconomy: Unemployment, Inflation, and Deflation

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Global Economic Growth and Development

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Stabilization in an Integrated World Economy

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Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

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Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

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Environmental Economics

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