Question 1

The signaling theory of education is most similar to the

Accepted Answer

A)  human capital theory of education. 
B)  discrimination theory of advertising. 
C)  signaling theory of advertising. 
D)  efficiency wage theory of labor economics. 
A)  human capital theory of education. 
B)  discrimination theory of advertising. 
C)  signaling theory of advertising. 
D)  efficiency wage theory of labor economics.

Question 2

Allen and Ellen both work at Burger Ranch. Allen is paid more than Ellen. Which of the following could explain why Allen is paid more?

Accepted Answer

A)  The manager discriminates against women. 
B)  Allen works the undesirable early morning shift. 
C)  Allen has more experience and so more human capital. 
D)  All of the above could be correct. 
A)  The manager discriminates against women. 
B)  Allen works the undesirable early morning shift. 
C)  Allen has more experience and so more human capital. 
D)  All of the above could be correct.

Question 3

Studies have shown that union workers earn about

Accepted Answer

A)  10 to 20 percent more than nonunion workers in similar jobs. 
B)  10 to 20 percent less than nonunion workers in similar jobs. 
C)  40 to 50 percent more than nonunion workers in similar jobs. 
D)  40 to 50 percent less than nonunion workers in similar jobs. 
A)  10 to 20 percent more than nonunion workers in similar jobs. 
B)  10 to 20 percent less than nonunion workers in similar jobs. 
C)  40 to 50 percent more than nonunion workers in similar jobs. 
D)  40 to 50 percent less than nonunion workers in similar jobs.

Question 4

The most popular movie stars have high incomes for a number of reasons. One such reason is

Accepted Answer

A)  an ability for almost everyone to enjoy movies at a relatively low cost. 
B)  the above-average intellect of the average movie star. 
C)  a compensating differential. 
D)  a lack of technological advances in the movie industry. 
A)  an ability for almost everyone to enjoy movies at a relatively low cost. 
B)  the above-average intellect of the average movie star. 
C)  a compensating differential. 
D)  a lack of technological advances in the movie industry.

Question 5

Sally and Harry both work at the local factory producing cars. Sally earns $22 per hour working the day shift, and Harry earns $25 per hour working the night shift. Sally and Harry do the same job, have the same experience, and have the same level of education. This means that the

Accepted Answer

A)  higher-paying job has a compensating wage differential of $3 per hour. 
B)  higher-paying job has a compensating wage differential of $25 per hour. 
C)  higher-paying job is intrinsically more attractive than the lower-paying job. 
D)  factory is discriminating against Sally because she is a woman. 
A)  higher-paying job has a compensating wage differential of $3 per hour. 
B)  higher-paying job has a compensating wage differential of $25 per hour. 
C)  higher-paying job is intrinsically more attractive than the lower-paying job. 
D)  factory is discriminating against Sally because she is a woman.

Question 6

Many studies of wage discrimination have been conducted on professional sports teams. This industry is easier to study than others because the professional teams have many objective measures of

Accepted Answer

The answer of Many studies of wage discrimination have been...

Question 7

George and Brad are waiters at a local restaurant. The female customers think that George is better looking than Brad. If George earns more than Brad, this could be an example of each of the following except

Accepted Answer

A)  customer preferences. 
B)  discrimination. 
C)  a beauty premium. 
D)  a compensating differential. 
A)  customer preferences. 
B)  discrimination. 
C)  a beauty premium. 
D)  a compensating differential.

Question 8

According to evidence provided by the U.S. government, the median black

Accepted Answer

A)  man earns more than the median black woman. 
B)  woman earns less than the median white woman 
C)  man earns less than the median white man. 
D)  All of the above are correct. 
A)  man earns more than the median black woman. 
B)  woman earns less than the median white woman 
C)  man earns less than the median white man. 
D)  All of the above are correct.

Question 9

Explain how compensating differentials could contribute to differences between the average wages of men and women.

Accepted Answer

Men and women may, on average, select di

Question 10

Which theory states that education is correlated with natural ability?

Accepted Answer

The answer of Which theory states that education is correlated...

Question 11

Evidence of differences in average wages of women compared to men

Accepted Answer

A)  clearly illustrates differences in productivity between genders. 
B)  provides conclusive evidence of discrimination on the basis of gender. 
C)  is seldom used to provide evidence of discriminatory bias. 
D)  does not provide conclusive evidence of discrimination. 
A)  clearly illustrates differences in productivity between genders. 
B)  provides conclusive evidence of discrimination on the basis of gender. 
C)  is seldom used to provide evidence of discriminatory bias. 
D)  does not provide conclusive evidence of discrimination.

Question 12

The accumulation of investments in people, such as education and on-the-job training, is known as

Accepted Answer

A)  physical capital. 
B)  human capital. 
C)  efficiency wage. 
D)  compensating differentials. 
A)  physical capital. 
B)  human capital. 
C)  efficiency wage. 
D)  compensating differentials.

Question 13

The market wage could be higher than the equilibrium wage if a worker

Accepted Answer

A)  belongs to a labor union. 
B)  is covered by a minimum-wage law. 
C)  is paid an efficiency wage. 
D)  All of the above are correct. 
A)  belongs to a labor union. 
B)  is covered by a minimum-wage law. 
C)  is paid an efficiency wage. 
D)  All of the above are correct.

Question 14

A signaling theory of education suggests that

Accepted Answer

A)  people who attend college are more likely to capture a "beauty premium." 
B)  education is a signal of social status. 
C)  education does not necessarily increase productivity. 
D)  education will sever the link between innate ability and compensation. 
A)  people who attend college are more likely to capture a "beauty premium." 
B)  education is a signal of social status. 
C)  education does not necessarily increase productivity. 
D)  education will sever the link between innate ability and compensation.

Question 15

Evaluate the following statement: "The gender pay gap provides evidence of widespread, severe, ongoing discrimination by employers and fellow workers."

Accepted Answer

There are many explanations of the gende

Question 16

The wage gap between skilled and unskilled worker has

Accepted Answer

A)  risen; economists argue that this may be due in part to technological progress. 
B)  risen; economists argue that none of the rise is due to technological progress. 
C)  fallen; economists argue that this may be due in part to technological progress. 
D)  fallen; economists argue that none of the fall is due to technological progress. 
A)  risen; economists argue that this may be due in part to technological progress. 
B)  risen; economists argue that none of the rise is due to technological progress. 
C)  fallen; economists argue that this may be due in part to technological progress. 
D)  fallen; economists argue that none of the fall is due to technological progress.

Question 17

Differences in human capital among groups of workers is possibly a reflection of past discrimination.

Accepted Answer

A) True 
 B)False

Question 18

Scenario 19-5
Jason works part-time at a grocery store after school. Jason has worked at the store for two years but still hasn't received a wage increase, even though newer employees have received raises. Jason has threatened his employer with a lawsuit if he doesn't get a raise in the next few weeks. Jason believes he is a victim of labor-market discrimination.
-Refer to Scenario 19-5. Why might an economist be skeptical of Jason's discrimination complaint?

Accepted Answer

A)  Through antitrust laws, discriminating firms can be penalized with large fees. 
B)  Differences in wages alone do not by themself prove discrimination. 
C)  Discrimination leads to profit maximization. 
D)  Even if customers dislike Jason because he's not helpful, if the store operates in a competitive market the store will pay Jason the same as other workers. 
A)  Through antitrust laws, discriminating firms can be penalized with large fees. 
B)  Differences in wages alone do not by themself prove discrimination. 
C)  Discrimination leads to profit maximization. 
D)  Even if customers dislike Jason because he's not helpful, if the store operates in a competitive market the store will pay Jason the same as other workers.

Question 19

After graduating from college, you receive job offers from five different accounting firms. All job offers have a different compensation package. Is it irrational for you to accept an offer that doesn't provide the highest level of monetary compensation? Use the concept of compensating differentials to explain your answer.

Accepted Answer

Compensating differentials refer to diff

Question 20

Attributing the gender wage gap to ongoing discrimination by employers will likely be incorrect because

Accepted Answer

A)  some of the wage gap is explained by efficiency wages. 
B)  differences in years of work experience likely lead to productivity differences between men and women. 
C)  compensating differentials usually lead to higher wages for women. 
D)  All of the above are correct. 
A)  some of the wage gap is explained by efficiency wages. 
B)  differences in years of work experience likely lead to productivity differences between men and women. 
C)  compensating differentials usually lead to higher wages for women. 
D)  All of the above are correct.

Exam 19: Earnings and Discrimination

The signaling theory of education is most similar to the

Allen and Ellen both work at Burger Ranch. Allen is paid more than Ellen. Which of the following could explain why Allen is paid more?

Studies have shown that union workers earn about

The most popular movie stars have high incomes for a number of reasons. One such reason is

Sally and Harry both work at the local factory producing cars. Sally earns $22 per hour working the day shift, and Harry earns $25 per hour working the night shift. Sally and Harry do the same job, have the same experience, and have the same level of education. This means that the

Many studies of wage discrimination have been conducted on professional sports teams. This industry is easier to study than others because the professional teams have many objective measures of

George and Brad are waiters at a local restaurant. The female customers think that George is better looking than Brad. If George earns more than Brad, this could be an example of each of the following except

According to evidence provided by the U.S. government, the median black

Explain how compensating differentials could contribute to differences between the average wages of men and women.

Which theory states that education is correlated with natural ability?

Evidence of differences in average wages of women compared to men

The accumulation of investments in people, such as education and on-the-job training, is known as

The market wage could be higher than the equilibrium wage if a worker

A signaling theory of education suggests that

Evaluate the following statement: "The gender pay gap provides evidence of widespread, severe, ongoing discrimination by employers and fellow workers."

The wage gap between skilled and unskilled worker has

Differences in human capital among groups of workers is possibly a reflection of past discrimination.

Attributing the gender wage gap to ongoing discrimination by employers will likely be incorrect because

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

Six Debates Over Macroeconomic Policy

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