Question 1

When the possibility for strongly efficient contracts occurs, what will happen?

Accepted Answer

A) The union and firm negotiate over the employment level but not over the wage. 
B) The union and firm negotiate over the wage level but not over the employment level. 
C) The labor demand curve must be vertical. 
D) Isoprofit lines must be horizontal. 
E) Isoprofit lines are parabolas that open upward. 
A) The union and firm negotiate over the employment level but not over the wage. 
B) The union and firm negotiate over the wage level but not over the employment level. 
C) The labor demand curve must be vertical. 
D) Isoprofit lines must be horizontal. 
E) Isoprofit lines are parabolas that open upward. B

Question 2

Which of the following does not describe the historical patterns of unionization and strike activity in the United States?

Accepted Answer

A) The percent of workers involved in a strike has steadily decreased over the last 40 years. 
B) The percent of public sector employees who are in a union remained relatively constant from 1950 to 2010. 
C) The percent of time lost to a strike has steadily decreased over the last 40 years. 
D) The percent of private sector employees who are in a union has steadily decreased over the last 40 years. 
E) Union membership did not change very much from 1900 to 1935. 
A) The percent of workers involved in a strike has steadily decreased over the last 40 years. 
B) The percent of public sector employees who are in a union remained relatively constant from 1950 to 2010. 
C) The percent of time lost to a strike has steadily decreased over the last 40 years. 
D) The percent of private sector employees who are in a union has steadily decreased over the last 40 years. 
E) Union membership did not change very much from 1900 to 1935. B

Question 3

The National Labor Relations Act of 1935 (also known as the Wagner Act) was significant because it

Accepted Answer

A) curtailed union power by permitting states to pass right-to-work laws. 
B) granted firms the right to break unions. 
C) outlawed yellow-dog contracts. 
D) created the National Labor Relations Board. 
E) granted union rank and file the right to decertify its leadership via election. 
A) curtailed union power by permitting states to pass right-to-work laws. 
B) granted firms the right to break unions. 
C) outlawed yellow-dog contracts. 
D) created the National Labor Relations Board. 
E) granted union rank and file the right to decertify its leadership via election. D

Question 4

Featherbedding refers to

Accepted Answer

A) negotiating better fringe benefits than non-union workers. 
B) one union using a previously negotiated contract as a starting point for its own negotiations. 
C) firing high-wage workers when the union goes on strike. 
D) the union requiring the firm to hire more workers than are actually needed to perform a particular task. 
E) the union using its members' dues to fund political activities. 
A) negotiating better fringe benefits than non-union workers. 
B) one union using a previously negotiated contract as a starting point for its own negotiations. 
C) firing high-wage workers when the union goes on strike. 
D) the union requiring the firm to hire more workers than are actually needed to perform a particular task. 
E) the union using its members' dues to fund political activities.

Question 5

Which of the following do unions usually advertise to their members and potential members?

Accepted Answer

A) High wages. 
B) Steady employment. 
C) An exit voice. 
D) A powerful political lobby. 
E) All of the above. 
A) High wages. 
B) Steady employment. 
C) An exit voice. 
D) A powerful political lobby. 
E) All of the above.

Question 6

Which of the following is a reason why the union wage gap might under-estimate the actual effect unions have on wages?

Accepted Answer

A) Unions typically attract the most productive workers to the application pool. 
B) Non-union firms may pay higher wages in order to prevent its workers from unionizing. 
C) Non-union jobs will have excess labor available to them because firms will restrict entry into union jobs, and competition for this excess labor competes down the observed non-union wage. 
D) Unions target high-paying firms. 
E) The union wage gap can be over-estimated, but never underestimated. 
A) Unions typically attract the most productive workers to the application pool. 
B) Non-union firms may pay higher wages in order to prevent its workers from unionizing. 
C) Non-union jobs will have excess labor available to them because firms will restrict entry into union jobs, and competition for this excess labor competes down the observed non-union wage. 
D) Unions target high-paying firms. 
E) The union wage gap can be over-estimated, but never underestimated.

Question 7

Which of the following is not associated with strikes?

Accepted Answer

A) Strikes are costly to the firm. 
B) Strikes are costly to the union. 
C) The probability of striking is generally pro-cyclical. 
D) Strike duration is generally pro-cyclical. 
E) If the union makes wage offers, it will likely do so according to a downward-sloping resistance curve. 
A) Strikes are costly to the firm. 
B) Strikes are costly to the union. 
C) The probability of striking is generally pro-cyclical. 
D) Strike duration is generally pro-cyclical. 
E) If the union makes wage offers, it will likely do so according to a downward-sloping resistance curve.

Question 8

Right- to-work laws

Accepted Answer

A) give workers the right to be represented by a union. 
B) give workers the right to not join a union. 
C) give a non-union worker the right to enjoy union benefits without paying union dues. 
D) give firms the right to hire replacement labor when the union strikes. 
E) give the firm the right to permanently fire anyone who strikes. 
A) give workers the right to be represented by a union. 
B) give workers the right to not join a union. 
C) give a non-union worker the right to enjoy union benefits without paying union dues. 
D) give firms the right to hire replacement labor when the union strikes. 
E) give the firm the right to permanently fire anyone who strikes.

Question 9

In a basic model of wage and employment determination with a monopoly union, the monopoly union stipulates the wage.The firm then responds by choosing an employment level that

Accepted Answer

A) maximizes profit. 
B) minimizes labor costs. 
C) minimizes the wage. 
D) maximizes strike duration. 
E) maximizes output. 
A) maximizes profit. 
B) minimizes labor costs. 
C) minimizes the wage. 
D) maximizes strike duration. 
E) maximizes output.

Question 10

An implication of the exit-voice hypothesis is that

Accepted Answer

A) union workers who earn lower wages will circumvent union leadership to ask management for pay raises. 
B) labor turnover (voluntary quits) will be lower at union firms than at non-union firms as workers can bring issues to management through their union leadership. 
C) the union wage gap will be higher for more experienced union members. 
D) dues paid by rank and file union members must increase prior to wage negotiations. 
E) dues paid by rank and file union members should be saved during stretches of labor peace in order to fund worker benefits during strikes. 
A) union workers who earn lower wages will circumvent union leadership to ask management for pay raises. 
B) labor turnover (voluntary quits) will be lower at union firms than at non-union firms as workers can bring issues to management through their union leadership. 
C) the union wage gap will be higher for more experienced union members. 
D) dues paid by rank and file union members must increase prior to wage negotiations. 
E) dues paid by rank and file union members should be saved during stretches of labor peace in order to fund worker benefits during strikes.

Question 11

The union wage gap for private sector unions in the United States is presently on the order of

Accepted Answer

A) 2%. 
B) 8%. 
C) 15%. 
D) 28%. 
E) 39%. 
A) 2%. 
B) 8%. 
C) 15%. 
D) 28%. 
E) 39%.

Question 12

In the case of a vertical contract curve, union negotiations will result in the firm hiring

Accepted Answer

A) more workers and at a higher wage than it would in the absence of the union. 
B) the same number of workers but at a higher wage than it would in the absence of the union. 
C) fewer workers but at a lower wage than it would in the absence of the union. 
D) fewer workers but at a higher wage than it would in the absence of the union. 
E) the same number of workers but at a lower wage than it would in the absence of the union. 
A) more workers and at a higher wage than it would in the absence of the union. 
B) the same number of workers but at a higher wage than it would in the absence of the union. 
C) fewer workers but at a lower wage than it would in the absence of the union. 
D) fewer workers but at a higher wage than it would in the absence of the union. 
E) the same number of workers but at a lower wage than it would in the absence of the union.

Question 13

Labor unions in the United States today

Accepted Answer

A) are as influential as they were in the 1950s. 
B) cover the same percent of workers as they did in years past. 
C) are much more popular among immigrant workers than among native workers. 
D) look to protect the interests of the employers of labor. 
E) tend to be less influential compared to labor unions in other developed countries. 
A) are as influential as they were in the 1950s. 
B) cover the same percent of workers as they did in years past. 
C) are much more popular among immigrant workers than among native workers. 
D) look to protect the interests of the employers of labor. 
E) tend to be less influential compared to labor unions in other developed countries.

Question 14

The wage-employment outcomes described by the contract curve

Accepted Answer

A) fail to exhaust all bargaining opportunities between the employer and the union, except for the single point on the contract curve that is associated with maximum wages. 
B) are associated with the firm hiring more workers at a higher wage than they would under a monopoly union outcome. 
C) are Pareto optimal and result in an efficient contract. 
D) must be located below and to the left of the outcome that would result in the absence of a union. 
E) must be located above and to the left of the outcome that results when there is a monopoly union. 
A) fail to exhaust all bargaining opportunities between the employer and the union, except for the single point on the contract curve that is associated with maximum wages. 
B) are associated with the firm hiring more workers at a higher wage than they would under a monopoly union outcome. 
C) are Pareto optimal and result in an efficient contract. 
D) must be located below and to the left of the outcome that would result in the absence of a union. 
E) must be located above and to the left of the outcome that results when there is a monopoly union.

Question 15

There are three firms in an industry, all of which hire comparably skilled workers.One firm is unionized and pays its 80 workers $11 per hour.Of the two non-union firms, one pays its 40 workers $12 per hour while the other pays its 160 workers $9.50 per hour.What is the union wage gap?

Accepted Answer

A) -8 percent 
B) 0 percent 
C) 10 percent 
D) 12.5 percent 
E) 27 percent 
A) -8 percent 
B) 0 percent 
C) 10 percent 
D) 12.5 percent 
E) 27 percent

Question 16

The Hicks Paradox concerns

Accepted Answer

A) the irrationality of unions. 
B) the irrationality of union dues. 
C) the irrationality of strikes. 
D) the irrationality of substituting low-skill labor for high-skill labor. 
E) the irrationality of negotiating additional fringe benefits for union workers at the cost of receiving lower wages. 
A) the irrationality of unions. 
B) the irrationality of union dues. 
C) the irrationality of strikes. 
D) the irrationality of substituting low-skill labor for high-skill labor. 
E) the irrationality of negotiating additional fringe benefits for union workers at the cost of receiving lower wages.

Question 17

Which one of the following statements is true?

Accepted Answer

A) Firms try to attract unions to their plants and factories. 
B) Unions are beneficial to all workers. 
C) Unions tend to negotiate better fringe benefits for their members than what non-union workers receive. 
D) Many workers are likely to lose their jobs when firms become unionized. 
E) A union is legally allowed to undertake any bargaining tactics that it wishes. 
A) Firms try to attract unions to their plants and factories. 
B) Unions are beneficial to all workers. 
C) Unions tend to negotiate better fringe benefits for their members than what non-union workers receive. 
D) Many workers are likely to lose their jobs when firms become unionized. 
E) A union is legally allowed to undertake any bargaining tactics that it wishes.

Question 18

A strike

Accepted Answer

A) can be a rational response during the union-firm negotiation process. 
B) is a Pareto optimal outcome. 
C) hurts the firm's management and share holders but not the union members. 
D) is never in the best interest of the rank and file. 
E) is always in the firm's best interest. 
A) can be a rational response during the union-firm negotiation process. 
B) is a Pareto optimal outcome. 
C) hurts the firm's management and share holders but not the union members. 
D) is never in the best interest of the rank and file. 
E) is always in the firm's best interest.

Question 19

Yellow-dog contracts

Accepted Answer

A) give workers the right to be represented by a union. 
B) give a non-union worker the right to enjoy union benefits without paying union dues. 
C) give firms the right to hire replacement labor when the union strikes. 
D) give firms the right to require a worker to not join a union as a condition of employment. 
E) give the firm the right to permanently fire anyone who strikes. 
A) give workers the right to be represented by a union. 
B) give a non-union worker the right to enjoy union benefits without paying union dues. 
C) give firms the right to hire replacement labor when the union strikes. 
D) give firms the right to require a worker to not join a union as a condition of employment. 
E) give the firm the right to permanently fire anyone who strikes.

Question 20

Union organizing drives will be more successful in firms that have relatively ___________ labor demand curves.

Accepted Answer

A) inelastic 
B) elastic 
C) flat 
D) linear 
E) increasing 
A) inelastic 
B) elastic 
C) flat 
D) linear 
E) increasing

When the possibility for strongly efficient contracts occurs, what will happen?

Which of the following does not describe the historical patterns of unionization and strike activity in the United States?

The National Labor Relations Act of 1935 (also known as the Wagner Act) was significant because it

Featherbedding refers to

Which of the following do unions usually advertise to their members and potential members?

Which of the following is a reason why the union wage gap might under-estimate the actual effect unions have on wages?

Which of the following is not associated with strikes?

Right- to-work laws

In a basic model of wage and employment determination with a monopoly union, the monopoly union stipulates the wage.The firm then responds by choosing an employment level that

An implication of the exit-voice hypothesis is that

The union wage gap for private sector unions in the United States is presently on the order of

In the case of a vertical contract curve, union negotiations will result in the firm hiring

Labor unions in the United States today

The wage-employment outcomes described by the contract curve

There are three firms in an industry, all of which hire comparably skilled workers.One firm is unionized and pays its 80 workers $11 per hour.Of the two non-union firms, one pays its 40 workers $12 per hour while the other pays its 160 workers $9.50 per hour.What is the union wage gap?

The Hicks Paradox concerns

Which one of the following statements is true?

A strike

Yellow-dog contracts

Union organizing drives will be more successful in firms that have relatively ___________ labor demand curves.

Introduction to Labor Economics

Labor Supply

Labor Demand

Labor Market Equilibrium

Compensating Wage Differentials

Human Capital

The Wage Structure

Labor Mobility

Labor Market Discrimination

Incentive Pay

Unemployment

Filters

Exam 10: Labor Unions

When the possibility for strongly efficient contracts occurs, what will happen?

Which of the following does not describe the historical patterns of unionization and strike activity in the United States?

The National Labor Relations Act of 1935 (also known as the Wagner Act) was significant because it

Featherbedding refers to

Which of the following do unions usually advertise to their members and potential members?

Which of the following is a reason why the union wage gap might under-estimate the actual effect unions have on wages?

Which of the following is not associated with strikes?

Right- to-work laws

In a basic model of wage and employment determination with a monopoly union, the monopoly union stipulates the wage.The firm then responds by choosing an employment level that

An implication of the exit-voice hypothesis is that

The union wage gap for private sector unions in the United States is presently on the order of

In the case of a vertical contract curve, union negotiations will result in the firm hiring

Labor unions in the United States today

The wage-employment outcomes described by the contract curve

There are three firms in an industry, all of which hire comparably skilled workers.One firm is unionized and pays its 80 workers $11 per hour.Of the two non-union firms, one pays its 40 workers $12 per hour while the other pays its 160 workers $9.50 per hour.What is the union wage gap?

The Hicks Paradox concerns

Which one of the following statements is true?

A strike

Yellow-dog contracts

Union organizing drives will be more successful in firms that have relatively ___________ labor demand curves.

Introduction to Labor Economics

Labor Supply

Labor Demand

Labor Market Equilibrium

Compensating Wage Differentials

Human Capital

The Wage Structure

Labor Mobility

Labor Market Discrimination

Incentive Pay

Unemployment

Filters