Question 1

Differences in wages between highly educated workers and less educated workers are most likely to be considered:

Accepted Answer

A)  unfair by all economists 
B)  completely fair by everyone 
C)  a compensating differential for the cost of becoming educated 
D)  a signal that the market is indifferent to a worker's level of human capital 
A)  unfair by all economists 
B)  completely fair by everyone 
C)  a compensating differential for the cost of becoming educated 
D)  a signal that the market is indifferent to a worker's level of human capital

Question 2

In the signalling theory of education, which of the following are considered to be true?

Accepted Answer

A)  schooling makes employees less productive 
B)  schooling does not affect a worker's productivity 
C)  workers signal to the employer that they are valuable employees because they were willing to spend time to get an education 
D)  women are less likely to do male-dominated majors like engineering 
A)  schooling makes employees less productive 
B)  schooling does not affect a worker's productivity 
C)  workers signal to the employer that they are valuable employees because they were willing to spend time to get an education 
D)  women are less likely to do male-dominated majors like engineering

Question 3

The statement that 'night shift workers make a higher wage than day shift workers' is likely to reflect:

Accepted Answer

A)  a general worker preference for day shift jobs 
B)  the fact that some people just prefer to work a night shift for non-monetary reasons 
C)  the fact that night shift jobs are generally more technically difficult 
D)  the fact that women work the night shift more than men 
A)  a general worker preference for day shift jobs 
B)  the fact that some people just prefer to work a night shift for non-monetary reasons 
C)  the fact that night shift jobs are generally more technically difficult 
D)  the fact that women work the night shift more than men

Question 4

The 'beauty premium' can be explained by the fact that:

Accepted Answer

A)  beauty acts as an implicit signal of innate intelligence 
B)  beautiful people are likely to reflect 'good breeding' 
C)  marginal productivity in all occupations has a physical dimension 
D)  in some occupations, physical attractiveness of a worker may enhance the value of their marginal product 
A)  beauty acts as an implicit signal of innate intelligence 
B)  beautiful people are likely to reflect 'good breeding' 
C)  marginal productivity in all occupations has a physical dimension 
D)  in some occupations, physical attractiveness of a worker may enhance the value of their marginal product

Question 5

Which of the following statements are true of wages, educational attainment and gender?

Accepted Answer

A)  male workers are compensated for attending university, while female workers generally are not 
B)  female workers are compensated for attending university, while male workers generally are not 
C)  neither gender receives a higher wage for attending university 
D)  both genders receive a higher wage for attending university 
A)  male workers are compensated for attending university, while female workers generally are not 
B)  female workers are compensated for attending university, while male workers generally are not 
C)  neither gender receives a higher wage for attending university 
D)  both genders receive a higher wage for attending university

Question 6

Effective minimum wage laws will most likely result in which of the following? (i) an increased demand for labour
(ii) a surplus of labour
(iii) unemployment

Accepted Answer

A)  (i) and (ii) 
B)  (ii) and (iii) 
C)  (i) and (iii) 
D)  (i), (ii) and (iii) 
A)  (i) and (ii) 
B)  (ii) and (iii) 
C)  (i) and (iii) 
D)  (i), (ii) and (iii)

Question 7

Explain the role of compensating differentials in explaining the difference between the average wages of men and women.

Accepted Answer

Men and women have traditionally selecte

Question 8

An increase in the human capital of workers is:

Accepted Answer

A)  likely to decrease their value of marginal product 
B)  likely to increase their value of marginal product 
C)  not likely to change their value of marginal product 
D)  a waste of resources for most jobs 
A)  likely to decrease their value of marginal product 
B)  likely to increase their value of marginal product 
C)  not likely to change their value of marginal product 
D)  a waste of resources for most jobs

Question 9

Empirical evidence based on analysis of education attainment suggests that:

Accepted Answer

A)  innate ability is the most important determinant of wages 
B)  students in states with compulsory schooling laws did not have higher wages than those in other states 
C)  almost all wages can be explained by factors linked to the signalling theory 
D)  education does increase the marginal productivity of workers 
A)  innate ability is the most important determinant of wages 
B)  students in states with compulsory schooling laws did not have higher wages than those in other states 
C)  almost all wages can be explained by factors linked to the signalling theory 
D)  education does increase the marginal productivity of workers

Question 10

Which of the following attributes could be important in determining a waitress's productivity?

Accepted Answer

A)  physical appearance 
B)  mental capacity 
C)  heredity and upbringing 
D)  all of the above 
A)  physical appearance 
B)  mental capacity 
C)  heredity and upbringing 
D)  all of the above

Question 11

If an employer believes in the theory of efficiency wages, he will raise wages in effort to do which of the following?

Accepted Answer

A)  increase worker effort and increase worker turnover 
B)  increase worker effort and decrease worker turnover 
C)  decrease worker effort and increase worker turnover 
D)  decrease worker effort and decrease worker turnover 
A)  increase worker effort and increase worker turnover 
B)  increase worker effort and decrease worker turnover 
C)  decrease worker effort and increase worker turnover 
D)  decrease worker effort and decrease worker turnover

Question 12

Suppose a forestry firm increases its investment in new technology for its sawmills. The firm employs both skilled and unskilled workers. After this new investment the wage gap between skilled and unskilled workers:

Accepted Answer

A)  is likely to be unaltered 
B)  is likely to fall 
C)  will rise only if marginal productivity of unskilled workers is not altered 
D)  is likely to rise 
A)  is likely to be unaltered 
B)  is likely to fall 
C)  will rise only if marginal productivity of unskilled workers is not altered 
D)  is likely to rise

Question 13

People who leave school with no qualifications typically have less human capital than those workers with university qualifications.

Accepted Answer

A) True 
 B)False

Question 14

Advocates of comparable worth would agree with which of the following statements? (i) compensation should be based on a set of impartial criteria
(ii) wages earned by women are the same as those earned by men who have the same level of training and education
(iii) occupational wage differences are discriminatory against women

Accepted Answer

A)  (i) and (iii) only 
B)  (i) and (ii) only 
C)  (ii) and (iii) only 
D)  (i), (ii) and (iii) 
A)  (i) and (iii) only 
B)  (i) and (ii) only 
C)  (ii) and (iii) only 
D)  (i), (ii) and (iii)

Question 15

One hypothesis to explain the rising gap in wages between unskilled and skilled workers is that international trade has altered the relative demand for skilled and unskilled workers.

Accepted Answer

A) True 
 B)False

Question 16

The wage differences we observe in the economy are, to a large extent, attributable to:

Accepted Answer

A)  inefficient markets 
B)  equivalent demand for labour across different jobs held by different groups of people 
C)  the determinants of equilibrium wage 
D)  constant productivities across different employment groups 
A)  inefficient markets 
B)  equivalent demand for labour across different jobs held by different groups of people 
C)  the determinants of equilibrium wage 
D)  constant productivities across different employment groups

Question 17

Profit-maximising competitive firms cannot discriminate in the hiring of workers unless consumers exercise a preference for discrimination in product markets.

Accepted Answer

A) True 
 B)False

Question 18

The statement, 'coal miners are paid more than workers with similar levels of education', is likely to reflect the fact that:

Accepted Answer

A)  coal mining is a declining industry 
B)  coal exports are rising 
C)  coal mining jobs are potentially more dangerous than jobs with comparable education requirements 
D)  all coal mines use union labour 
A)  coal mining is a declining industry 
B)  coal exports are rising 
C)  coal mining jobs are potentially more dangerous than jobs with comparable education requirements 
D)  all coal mines use union labour

Question 19

If a firm is in a competitive product market but practices discrimination when hiring workers, then it:

Accepted Answer

A)  will survive, if it increases production and captures a larger market share 
B)  will eventually earn zero economic profits 
C)  will be less profitable than firms that don't discriminate and may not survive 
D)  will survive as long as it is willing to have a smaller market share 
A)  will survive, if it increases production and captures a larger market share 
B)  will eventually earn zero economic profits 
C)  will be less profitable than firms that don't discriminate and may not survive 
D)  will survive as long as it is willing to have a smaller market share

Question 20

The fact that women are more likely to interrupt their careers to raise children reflects:

Accepted Answer

A)  a potential market-based reason why average wages for men exceed those for women 
B)  further evidence that labour markets discriminate against women 
C)  evidence that society undervalues the role of women in the market place 
D)  evidence that markets are inefficient at allocating labour resources 
A)  a potential market-based reason why average wages for men exceed those for women 
B)  further evidence that labour markets discriminate against women 
C)  evidence that society undervalues the role of women in the market place 
D)  evidence that markets are inefficient at allocating labour resources

Exam 20: Earnings, Unions and Discrimination

Differences in wages between highly educated workers and less educated workers are most likely to be considered:

In the signalling theory of education, which of the following are considered to be true?

The statement that 'night shift workers make a higher wage than day shift workers' is likely to reflect:

The 'beauty premium' can be explained by the fact that:

Which of the following statements are true of wages, educational attainment and gender?

Effective minimum wage laws will most likely result in which of the following? (i) an increased demand for labour (ii) a surplus of labour (iii) unemployment

Explain the role of compensating differentials in explaining the difference between the average wages of men and women.

An increase in the human capital of workers is:

Empirical evidence based on analysis of education attainment suggests that:

Which of the following attributes could be important in determining a waitress's productivity?

If an employer believes in the theory of efficiency wages, he will raise wages in effort to do which of the following?

Suppose a forestry firm increases its investment in new technology for its sawmills. The firm employs both skilled and unskilled workers. After this new investment the wage gap between skilled and unskilled workers:

People who leave school with no qualifications typically have less human capital than those workers with university qualifications.

One hypothesis to explain the rising gap in wages between unskilled and skilled workers is that international trade has altered the relative demand for skilled and unskilled workers.

The wage differences we observe in the economy are, to a large extent, attributable to:

Profit-maximising competitive firms cannot discriminate in the hiring of workers unless consumers exercise a preference for discrimination in product markets.

The statement, 'coal miners are paid more than workers with similar levels of education', is likely to reflect the fact that:

If a firm is in a competitive product market but practices discrimination when hiring workers, then it:

The fact that women are more likely to interrupt their careers to raise children reflects:

Ten Lessons From 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

Business Strategy

Competition Policy

Monopolistic Competition

The Markets for the Factors of Production

Income Inequity and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment and the Financial System

The Natural Rate of Unemployment

The Monetary System

Inflation: Its Causes and Costs

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 Trade-Off Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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