Question 1

Which of the following is an example of human capital?

Accepted Answer

A)  Machines built by people. 
B)  Formal education acquired in schools. 
C)  On-the-job training. 
D)  Both b and c are correct. 
A)  Machines built by people. 
B)  Formal education acquired in schools. 
C)  On-the-job training. 
D)  Both b and c are correct.

Question 2

Some economists suggest that international trade has led to an expanding wage gap between high-skill and low-skill workers in the United States.

Accepted Answer

A) True 
 B)False

Question 3

Assume men,on balance,have lower amounts of human capital than women have.Then we would expect

Accepted Answer

A)  the demand for female labor to be lower than the demand for male labor. 
B)  the demand for female labor to be higher than the demand for male labor. 
C)  the supply of female labor to be lower than the demand for male labor. 
D)  the supply of female labor to be higher than the supply of male labor. 
A)  the demand for female labor to be lower than the demand for male labor. 
B)  the demand for female labor to be higher than the demand for male labor. 
C)  the supply of female labor to be lower than the demand for male labor. 
D)  the supply of female labor to be higher than the supply of male labor.

Question 4

Politicians often point to wage differentials as evidence of labor market discrimination against ethnic minorities and women.Economists,however,argue against this approach because

Accepted Answer

A)  they don't believe the wage differential really exists. 
B)  they can't agree on a definition of the term "discrimination." 
C)  they believe compensating differentials account for all wage differences. 
D)  different people may have different wages for reasons unrelated to discrimination. 
A)  they don't believe the wage differential really exists. 
B)  they can't agree on a definition of the term "discrimination." 
C)  they believe compensating differentials account for all wage differences. 
D)  different people may have different wages for reasons unrelated to discrimination.

Question 5

The term "compensating differential" refers to

Accepted Answer

A)  the fact that workers who do similar work should be paid the same wage. 
B)  the fact that some workers live further from their jobs than do other workers. 
C)  a wage difference that is distinguishable on the basis of monetary characteristics. 
D)  a wage difference that arises from nonmonetary characteristics of different jobs. 
A)  the fact that workers who do similar work should be paid the same wage. 
B)  the fact that some workers live further from their jobs than do other workers. 
C)  a wage difference that is distinguishable on the basis of monetary characteristics. 
D)  a wage difference that arises from nonmonetary characteristics of different jobs.

Question 6

Suppose that a company hires recent college graduates for two types of jobs,sales people and credit analysts.The hours worked and skill levels are the same for both positions.The sales people get to travel to several desirable locations,whereas the credit analysts do not leave the home office.When comparing the salaries of the two positions,it is likely that the company pays the

Accepted Answer

A)  sales people less as a compensating differential. 
B)  credit analysts less as a compensating differential. 
C)  same salary for both positions because they require the same skill level. 
D)  same salary for both positions because it would be illegal to do otherwise. 
A)  sales people less as a compensating differential. 
B)  credit analysts less as a compensating differential. 
C)  same salary for both positions because they require the same skill level. 
D)  same salary for both positions because it would be illegal to do otherwise.

Question 7

List the productivity factors that may explain the differences in pay between men and women in similar occupations.Do any of these factors arise as a result of cultural or social traditions? If so,describe how changes in social relationships will affect the pay gap over time.

Accepted Answer

Job experience,education,lifet

Question 8

Economists who study labor markets have documented

Accepted Answer

A)  a general decline in the wages of college graduates over the last decade. 
B)  an increasing trend in U.S.labor markets for employers to pay all costs of education and training. 
C)  a decrease in the earnings gap between low-skill and high-skill workers over the past two decades. 
D)  an increase in the earnings gap between low-skill and high-skill workers over the past two decades. 
A)  a general decline in the wages of college graduates over the last decade. 
B)  an increasing trend in U.S.labor markets for employers to pay all costs of education and training. 
C)  a decrease in the earnings gap between low-skill and high-skill workers over the past two decades. 
D)  an increase in the earnings gap between low-skill and high-skill workers over the past two decades.

Question 9

Regarding wage differences among various groups of workers - blacks and whites,men and women,etc.- most economists believe that

Accepted Answer

A)  no such differences are evident from the available data. 
B)  most of the differences are attributable to discrimination. 
C)  some of the wage differences are attributable to discrimination,but there is disagreement about how much. 
D)  none of the differences are attributable to discrimination. 
A)  no such differences are evident from the available data. 
B)  most of the differences are attributable to discrimination. 
C)  some of the wage differences are attributable to discrimination,but there is disagreement about how much. 
D)  none of the differences are attributable to discrimination.

Question 10

If employers are profit-maximizers,then

Accepted Answer

A)  competition will always eventually eliminate employment discrimination. 
B)  employment discrimination may persist if consumers discriminate. 
C)  employment discrimination will persist because it is always profitable. 
D)  compensating differentials cannot exist. 
A)  competition will always eventually eliminate employment discrimination. 
B)  employment discrimination may persist if consumers discriminate. 
C)  employment discrimination will persist because it is always profitable. 
D)  compensating differentials cannot exist.

Question 11

Which of the following is not an example of changing employment trends?

Accepted Answer

A)  The number of people wanting to work in the personal services sector in the U.S.is increasing. 
B)  Employment in the U.S.agricultural sector has declined by about 30 percentage points in the last century. 
C)  Technological advances have replaced a great many routine jobs in the U.S.such as bank tellers and telephone operators. 
D)  Employment in the U.S.manufacturing sector has declined,while employment in manufacturing has increased worldwide. 
A)  The number of people wanting to work in the personal services sector in the U.S.is increasing. 
B)  Employment in the U.S.agricultural sector has declined by about 30 percentage points in the last century. 
C)  Technological advances have replaced a great many routine jobs in the U.S.such as bank tellers and telephone operators. 
D)  Employment in the U.S.manufacturing sector has declined,while employment in manufacturing has increased worldwide.

Question 12

A difference in wages that reflects differences in the nonpay features of two jobs is called

Accepted Answer

A)  a compensating differential. 
B)  a wage adjustment. 
C)  an efficiency wage. 
D)  a minimum wage. 
A)  a compensating differential. 
B)  a wage adjustment. 
C)  an efficiency wage. 
D)  a minimum wage.

Question 13

Politicians often point to wage differentials as evidence of labor-market discrimination against ethnic minorities and women;however,economists argue against this approach because people differ in the kinds of work they are willing and able to do.

Accepted Answer

A) True 
 B)False

Question 14

Other things equal,when the supply of workers is low,one would predict that market wages would be

Accepted Answer

A)  relatively high. 
B)  relatively low. 
C)  determined solely by factors that affect demand. 
D)  determined outside the domain of economic theory. 
A)  relatively high. 
B)  relatively low. 
C)  determined solely by factors that affect demand. 
D)  determined outside the domain of economic theory.

Question 15

Explain the theory that education acts as a signaling device.How does this contrast with the theory of education as an investment in human capital?

Accepted Answer

The theory of signaling suggests that th

Question 16

On average,electricians who work on dangerous high-voltage power lines earn more per hour than similarly skilled electricians who don't work on dangerous high-voltage power lines.The difference in pay is attributed to

Accepted Answer

A)  the marginal product of labor. 
B)  the marginal product of capital. 
C)  diminishing marginal returns. 
D)  a compensating differential. 
A)  the marginal product of labor. 
B)  the marginal product of capital. 
C)  diminishing marginal returns. 
D)  a compensating differential.

Question 17

In the experiment conducted by economists Muriel Niederle and Lise Vesterlund

Accepted Answer

A)  men were better at adding than women. 
B)  women chose the tournament payoff scheme more than men. 
C)  75% of men thought they won the four-player tournament part of the experiment. 
D)  demonstrated that women face significant wage discrimination in stock brokerages.. 
A)  men were better at adding than women. 
B)  women chose the tournament payoff scheme more than men. 
C)  75% of men thought they won the four-player tournament part of the experiment. 
D)  demonstrated that women face significant wage discrimination in stock brokerages..

Question 18

A college degree makes a person more productive according to

Accepted Answer

A)  both the human-capital and the signaling theories of education. 
B)  the human-capital but not the signaling theory of education. 
C)  the signaling but not the human-capital theory of education. 
D)  neither the human-capital nor the signaling theory of education. 
A)  both the human-capital and the signaling theories of education. 
B)  the human-capital but not the signaling theory of education. 
C)  the signaling but not the human-capital theory of education. 
D)  neither the human-capital nor the signaling theory of education.

Question 19

Workers whose skills become obsolete as a result of technological change are often paid a lower wage as a result of

Accepted Answer

A)  natural ability. 
B)  geographic location of employment. 
C)  chance. 
D)  work effort. 
A)  natural ability. 
B)  geographic location of employment. 
C)  chance. 
D)  work effort.

Question 20

Which of the following can be used to help explain wage differences among different groups of workers?

Accepted Answer

A)  human capital acquired through education 
B)  human capital acquired through job experience 
C)  compensating differentials 
D)  All of the above can explain wage differences. 
A)  human capital acquired through education 
B)  human capital acquired through job experience 
C)  compensating differentials 
D)  All of the above can explain wage differences.

Exam 19: Earnings and Discrimination

Which of the following is an example of human capital?

Some economists suggest that international trade has led to an expanding wage gap between high-skill and low-skill workers in the United States.

Assume men,on balance,have lower amounts of human capital than women have.Then we would expect

Politicians often point to wage differentials as evidence of labor market discrimination against ethnic minorities and women.Economists,however,argue against this approach because

The term "compensating differential" refers to

List the productivity factors that may explain the differences in pay between men and women in similar occupations.Do any of these factors arise as a result of cultural or social traditions? If so,describe how changes in social relationships will affect the pay gap over time.

Economists who study labor markets have documented

Regarding wage differences among various groups of workers - blacks and whites,men and women,etc.- most economists believe that

If employers are profit-maximizers,then

Which of the following is not an example of changing employment trends?

A difference in wages that reflects differences in the nonpay features of two jobs is called

Politicians often point to wage differentials as evidence of labor-market discrimination against ethnic minorities and women;however,economists argue against this approach because people differ in the kinds of work they are willing and able to do.

Other things equal,when the supply of workers is low,one would predict that market wages would be

Explain the theory that education acts as a signaling device.How does this contrast with the theory of education as an investment in human capital?

On average,electricians who work on dangerous high-voltage power lines earn more per hour than similarly skilled electricians who don't work on dangerous high-voltage power lines.The difference in pay is attributed to

In the experiment conducted by economists Muriel Niederle and Lise Vesterlund

A college degree makes a person more productive according to

Workers whose skills become obsolete as a result of technological change are often paid a lower wage as a result of

Which of the following can be used to help explain wage differences among different groups of workers?

Ten Principles of 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

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Income Inequality 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 Basic Tools of Finance

Unemployment

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 Trade-Off Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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