Question 1

Assuming workers and jobs are identical,if information is perfect but job search and migration are costly,then:

Accepted Answer

A) labor may or may not flow among employers 
B) labor will flow among employers until all wages are equal 
C) labor will flow among employers until all economic profits are zero,but wages may be unequal 
D) all firms will hire the same number of workers in equilibrium and pay them all the same wage 
A) labor may or may not flow among employers 
B) labor will flow among employers until all wages are equal 
C) labor will flow among employers until all economic profits are zero,but wages may be unequal 
D) all firms will hire the same number of workers in equilibrium and pay them all the same wage A

Question 2

Of the following industries,2011 average hourly earnings were greatest in:

Accepted Answer

A) public administration 
B) services 
C) mining 
D) construction 
A) public administration 
B) services 
C) mining 
D) construction C

Question 3

Which of the following is not a source of persistent compensating wage differentials?

Accepted Answer

A) migration from lower paying jobs to higher paying jobs 
B) fringe benefits 
C) job status 
D) different skill requirements 
A) migration from lower paying jobs to higher paying jobs 
B) fringe benefits 
C) job status 
D) different skill requirements A

Question 4

The concept of noncompeting groups suggests that workers in different groups:

Accepted Answer

A) are legally prevented from competing with one another 
B) are imperfect substitutes for one another 
C) have comparable characteristics but work for firms in different industries 
D) have identical stocks of human capital but differing preferences for nonwage job characteristics 
A) are legally prevented from competing with one another 
B) are imperfect substitutes for one another 
C) have comparable characteristics but work for firms in different industries 
D) have identical stocks of human capital but differing preferences for nonwage job characteristics

Question 5

Suppose a firm decides to raise pay as a way to reduce worker turnover.The resulting pay differential:

Accepted Answer

A) is a transitional differential 
B) will reduce labor supply to the firm 
C) will normally be offset by other pay differentials,leaving the policy ineffective 
D) is an equilibrium differential 
A) is a transitional differential 
B) will reduce labor supply to the firm 
C) will normally be offset by other pay differentials,leaving the policy ineffective 
D) is an equilibrium differential

Question 6

refer to the following diagrams. 
-As a result of the matching between workers and firms,firm X will pay:

Accepted Answer

A) a lower wage and provide less job safety than firm Y 
B) a lower wage and provide more job safety than firm Y 
C) a higher wage and provide less job safety than firm Y 
D) a higher wage and provide more job safety than firm Y 
A) a lower wage and provide less job safety than firm Y 
B) a lower wage and provide more job safety than firm Y 
C) a higher wage and provide less job safety than firm Y 
D) a higher wage and provide more job safety than firm Y

Question 7

refer to the following  
-Which one of the following best explains the differences in the isoprofit curves of the two firms?

Accepted Answer

A) X has lower profits than Y because X is paying higher wages 
B) X has higher profits than Y because X's high wages attract workers who are less relaxed and thereby less likely to shirk on the job 
C) X pays a higher cost than Y for providing additional informality 
D) Y pays a higher cost than X for providing additional informality 
A) X has lower profits than Y because X is paying higher wages 
B) X has higher profits than Y because X's high wages attract workers who are less relaxed and thereby less likely to shirk on the job 
C) X pays a higher cost than Y for providing additional informality 
D) Y pays a higher cost than X for providing additional informality

Question 8

The wage rate paid workers at Flow,Inc.will most likely exceed that at otherwise identical Stock Co.if:

Accepted Answer

A) Flow,Inc.is a more prestigious firm than Stock Co. 
B) earnings are subject to greater variability at Stock,Co. 
C) Stock Co.offers better pension and insurance benefits than Flow,Inc. 
D) the demand for labor at Stock Co.exceeds the demand for labor at Flow,Inc. 
A) Flow,Inc.is a more prestigious firm than Stock Co. 
B) earnings are subject to greater variability at Stock,Co. 
C) Stock Co.offers better pension and insurance benefits than Flow,Inc. 
D) the demand for labor at Stock Co.exceeds the demand for labor at Flow,Inc.

Question 9

Assuming workers and jobs are identical,if information is perfect and job search and migration are costless,then:

Accepted Answer

A) labor may or may not flow among employers 
B) labor will flow among employers until all wages are equal 
C) labor will flow among employers until all economic profits are zero,but wages may be unequal 
D) all firms will hire the same number of workers in equilibrium and pay them all the same wage 
A) labor may or may not flow among employers 
B) labor will flow among employers until all wages are equal 
C) labor will flow among employers until all economic profits are zero,but wages may be unequal 
D) all firms will hire the same number of workers in equilibrium and pay them all the same wage

Question 10

Which one of the following is a true statement?

Accepted Answer

A) Workers can never move from one noncompeting group to another 
B) Wage differentials caused by the existence of noncompeting groups can persist over time 
C) The concept of noncompeting groups applies only to workers in different geographical locations; it does not apply to productivity differences among workers 
D) The concept of noncompeting groups explains why wage rates do not fall in a recession 
A) Workers can never move from one noncompeting group to another 
B) Wage differentials caused by the existence of noncompeting groups can persist over time 
C) The concept of noncompeting groups applies only to workers in different geographical locations; it does not apply to productivity differences among workers 
D) The concept of noncompeting groups explains why wage rates do not fall in a recession

Question 11

Of the following occupational groups,2011 average hourly earnings were greatest among:

Accepted Answer

A) service workers 
B) installation,maintenance,and repair workers 
C) production workers 
D) management,business,and financial workers 
A) service workers 
B) installation,maintenance,and repair workers 
C) production workers 
D) management,business,and financial workers

Question 12

In 2010,hourly pay (measured in U.S.dollars)was highest in:

Accepted Answer

A) Sweden 
B) Japan 
C) U.S. 
D) Norway 
A) Sweden 
B) Japan 
C) U.S. 
D) Norway

Question 13

refer to the following diagrams. 
-In equilibrium:

Accepted Answer

A) worker A will work for firm X; worker B will work for firm Y 
B) worker A will work for firm Y; worker B will work for firm X 
C) both workers will work for firm X 
D) both workers will work for firm Y 
A) worker A will work for firm X; worker B will work for firm Y 
B) worker A will work for firm Y; worker B will work for firm X 
C) both workers will work for firm X 
D) both workers will work for firm Y

Question 14

The hedonic theory of wages predicts that:

Accepted Answer

A) workers and firms will be matched randomly,but in equilibrium firms will be maximizing profits and workers will be maximizing utility 
B) other things equal,workers who value job safety least will tend to work for firms that have the lowest cost of providing safe jobs 
C) other things equal,workers who value job safety least will tend to work for firms that have the highest cost of providing safe jobs 
D) other things equal,workers who value job safety most will tend to work for firms that have the highest cost of providing safe jobs 
A) workers and firms will be matched randomly,but in equilibrium firms will be maximizing profits and workers will be maximizing utility 
B) other things equal,workers who value job safety least will tend to work for firms that have the lowest cost of providing safe jobs 
C) other things equal,workers who value job safety least will tend to work for firms that have the highest cost of providing safe jobs 
D) other things equal,workers who value job safety most will tend to work for firms that have the highest cost of providing safe jobs

Question 15

If job X pays more than identical job Y,then the wage rates will:

Accepted Answer

A) remain different if mobility is costless 
B) remain different if information is perfect 
C) equalize because labor will migrate from X to Y 
D) equalize if information is perfect and mobility is costless 
A) remain different if mobility is costless 
B) remain different if information is perfect 
C) equalize because labor will migrate from X to Y 
D) equalize if information is perfect and mobility is costless

Question 16

Edlund and Korn suggest that prostitutes are highly paid primarily because:

Accepted Answer

A) there is a wage differential to compensate for the risks of getting caught or acquiring a disease 
B) there is a wage differential to compensate for doing without wage and earnings growth 
C) most of their earnings goes to their "pimp" or "madam" 
D) there is a wage differential to compensate for doing without the benefits of marriage 
A) there is a wage differential to compensate for the risks of getting caught or acquiring a disease 
B) there is a wage differential to compensate for doing without wage and earnings growth 
C) most of their earnings goes to their "pimp" or "madam" 
D) there is a wage differential to compensate for doing without the benefits of marriage

Question 17

refer to the diagram below, which represents a local labor market consisting of two submarkets. All workers are assumed to be identical.

-Assume that information is perfect,mobility between jobs is costless,and that all nonwage aspects of the two are identical.The outcome shown in the diagram:

Accepted Answer

A) represents an equilibrium 
B) does not represent an equilibrium.The demand for labor in market A will shift rightward,and that in market B will shift leftward until wage rates equalize 
C) does not represent an equilibrium.The supply of labor in market A will shift leftward,and that in market B will shift rightward until the wage rates equalize 
D) does not represent an equilibrium.The supply of labor in market B will shift leftward,and that in market A will shift rightward until the wage rates equalize 
A) represents an equilibrium 
B) does not represent an equilibrium.The demand for labor in market A will shift rightward,and that in market B will shift leftward until wage rates equalize 
C) does not represent an equilibrium.The supply of labor in market A will shift leftward,and that in market B will shift rightward until the wage rates equalize 
D) does not represent an equilibrium.The supply of labor in market B will shift leftward,and that in market A will shift rightward until the wage rates equalize

Question 18

Which of the following would tend to increase labor supply to a particular job?

Accepted Answer

A) The employer cuts back the scope and coverage of the medical plan 
B) Vesting in the firm's pension plan is pushed back from 1 year to 5 years 
C) The crime rate rises in the city where the job is located 
D) The perceived status of the job improves 
A) The employer cuts back the scope and coverage of the medical plan 
B) Vesting in the firm's pension plan is pushed back from 1 year to 5 years 
C) The crime rate rises in the city where the job is located 
D) The perceived status of the job improves

Question 19

All else equal,the wage paid to steelworkers in Youngstown,Ohio will be lower if:

Accepted Answer

A) the cost of living in Youngstown is lower than elsewhere 
B) working in the steel industry is louder and more dangerous than similar jobs 
C) steelworkers have less control over their work environment than in similar jobs 
D) there are fewer prospects for promotion among steelworkers than in similar jobs 
A) the cost of living in Youngstown is lower than elsewhere 
B) working in the steel industry is louder and more dangerous than similar jobs 
C) steelworkers have less control over their work environment than in similar jobs 
D) there are fewer prospects for promotion among steelworkers than in similar jobs

Question 20

refer to the diagram below, which represents a local labor market consisting of two submarkets. All workers are assumed to be identical.

-Suppose that the wage in B is higher because workers perceive disutility of $2 associated with this job relative to A.Assuming that information is perfect and mobility between jobs is costless,we can conclude that:

Accepted Answer

A) the wage differential between jobs A and B is an equilibrium differential 
B) workers will flow from job A to job B 
C) workers will flow from job B to job A 
D) the demand for labor in B will fall and the demand for labor in A will rise 
A) the wage differential between jobs A and B is an equilibrium differential 
B) workers will flow from job A to job B 
C) workers will flow from job B to job A 
D) the demand for labor in B will fall and the demand for labor in A will rise

Assuming workers and jobs are identical,if information is perfect but job search and migration are costly,then:

Of the following industries,2011 average hourly earnings were greatest in:

Which of the following is not a source of persistent compensating wage differentials?

The concept of noncompeting groups suggests that workers in different groups:

Suppose a firm decides to raise pay as a way to reduce worker turnover.The resulting pay differential:

refer to the following diagrams. -As a result of the matching between workers and firms,firm X will pay:

refer to the following diagram -Which one of the following best explains the differences in the isoprofit curves of the two firms?

The wage rate paid workers at Flow,Inc.will most likely exceed that at otherwise identical Stock Co.if:

Assuming workers and jobs are identical,if information is perfect and job search and migration are costless,then:

Which one of the following is a true statement?

Of the following occupational groups,2011 average hourly earnings were greatest among:

In 2010,hourly pay (measured in U.S.dollars)was highest in:

refer to the following diagrams. -In equilibrium:

The hedonic theory of wages predicts that:

If job X pays more than identical job Y,then the wage rates will:

Edlund and Korn suggest that prostitutes are highly paid primarily because:

refer to the diagram below, which represents a local labor market consisting of two submarkets. All workers are assumed to be identical. -Assume that information is perfect,mobility between jobs is costless,and that all nonwage aspects of the two are identical.The outcome shown in the diagram:

Which of the following would tend to increase labor supply to a particular job?

All else equal,the wage paid to steelworkers in Youngstown,Ohio will be lower if:

Labor Economics: Introduction and Overview

The Theory of Individual Labor Supply

Population, Participation Rates, and Hours of Work

Labor Quality: Investing in Human Capital

The Demand for Labor

Wage Determination and the Allocation of Labor

Alternative Pay Schemes and Labor Efficiency

Mobility,Migration,and Efficiency

Labor Unions and Collective Bargaining

The Economic Impact of Unions

Government and the Labor Market: Employment, Expenditures, and Taxation

Government and the Labor Market: Legislation and Regulation

Labor Market Discrimination

Job Search: External and Internal

The Distribution of Personal Earnings

Labor Productivity: Wages,Prices,and Employment

Employment and Unemployment

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Exam 8: The Wage Structure

Assuming workers and jobs are identical,if information is perfect but job search and migration are costly,then:

Of the following industries,2011 average hourly earnings were greatest in:

Which of the following is not a source of persistent compensating wage differentials?

The concept of noncompeting groups suggests that workers in different groups:

Suppose a firm decides to raise pay as a way to reduce worker turnover.The resulting pay differential:

refer to the following diagrams. -As a result of the matching between workers and firms,firm X will pay:

refer to the following diagram -Which one of the following best explains the differences in the isoprofit curves of the two firms?

The wage rate paid workers at Flow,Inc.will most likely exceed that at otherwise identical Stock Co.if:

Assuming workers and jobs are identical,if information is perfect and job search and migration are costless,then:

Which one of the following is a true statement?

Of the following occupational groups,2011 average hourly earnings were greatest among:

In 2010,hourly pay (measured in U.S.dollars)was highest in:

refer to the following diagrams. -In equilibrium:

The hedonic theory of wages predicts that:

If job X pays more than identical job Y,then the wage rates will:

Edlund and Korn suggest that prostitutes are highly paid primarily because:

refer to the diagram below, which represents a local labor market consisting of two submarkets. All workers are assumed to be identical. -Assume that information is perfect,mobility between jobs is costless,and that all nonwage aspects of the two are identical.The outcome shown in the diagram:

Which of the following would tend to increase labor supply to a particular job?

All else equal,the wage paid to steelworkers in Youngstown,Ohio will be lower if:

Labor Economics: Introduction and Overview

The Theory of Individual Labor Supply

Population, Participation Rates, and Hours of Work

Labor Quality: Investing in Human Capital

The Demand for Labor

Wage Determination and the Allocation of Labor

Alternative Pay Schemes and Labor Efficiency

Mobility,Migration,and Efficiency

Labor Unions and Collective Bargaining

The Economic Impact of Unions

Government and the Labor Market: Employment, Expenditures, and Taxation

Government and the Labor Market: Legislation and Regulation

Labor Market Discrimination

Job Search: External and Internal

The Distribution of Personal Earnings

Labor Productivity: Wages,Prices,and Employment

Employment and Unemployment

Filters