Question 1

Use the resource demand data shown on the left and the resource supply data on the right in answering the following question:   Labor Demand Data ‾ Labor Supply Data ‾Employment‾0123456MarginalProduct‾0152839485560 Product  Price ‾$2.202.001.801.601.401.201.00Employment‾0123456 Wage Rate ‾−−$1.002.003.004.005.006.00\begin{array}{c}\underline{	ext { Labor Demand Data }}\quad\quad\quad\quad\quad\quad\quad\quad\underline{	ext { Labor Supply Data }}\\begin{array}{c}\\underline{	ext {Employment}}\0\1\2\3\4\5\6\end{array}\begin{array}{c}	ext {Marginal}\\underline{	ext {Product}}\0\15\28\39\48\55\60\end{array}\begin{array}{c}	ext { Product }\\underline{	ext { Price } }\\$ 2.20 \2.00 \1.80 \1.60 \1.40 \1.20 \1.00 \end{array}\begin{array}{c}\\underline{	ext {Employment}}\0\1\2\3\4\5\6 \end{array}\begin{array}{c}	ext { Wage}\\underline{	ext { Rate }} \-- \\$1.00 \2.00\3.00 \4.00 \5.00 \6.00\end{array}\end{array} Labor Demand Data ​ Labor Supply Data ​Employment​0123456​MarginalProduct​0152839485560​ Product  Price ​$2.202.001.801.601.401.201.00​Employment​0123456​ Wage Rate ​−−$1.002.003.004.005.006.00​​ 
  Refer to the given data.How many units of output will this profit-maximizing firm produce?

Accepted Answer

A)   39.
B)   48.
C)   55.
D)   60.

Question 2

Piece-rates may not be appropriate pay in some situations because they might reduce product quality.

Accepted Answer

A) True 
 B)False

Question 3

Those who feel that unions positively affect productivity and efficiency argue that unions are:

Accepted Answer

A)   "voice mechanisms" that reduce labor turnover.
B)   "exit mechanisms" that reduce labor turnover.
C)   "voice mechanisms" that accelerate labor turnover.
D)   "exit mechanisms" that accelerate labor turnover.

Question 4

Which of the following tactics is most associated with the demand-enhancement union model?

Accepted Answer

A)   Reducing the price of inputs that are substitutes for union workers.
B)   Lobbying for increases in public expenditures on the product it is producing.
C)   Restricting the number of workers allowed to work in the industry.
D)   Increasing the price of products that are complements for the one it is producing.

Question 5

Use the labor demand data on the left and the labor supply data on the right in answering the following question:   Labor Demand Data ‾ Labor Supply Data ‾Employment‾0123456MarginalProduct‾014129742 Product  Price ‾$3333333Employment‾0123456 Wage Rate ‾$11111111111111\begin{array}{c}\underline{	ext { Labor Demand Data }}\quad\quad\quad\quad\quad\quad\quad\quad\underline{	ext { Labor Supply Data }}\\begin{array}{c}\\underline{	ext {Employment}}\0\1\2\3\4\5\6\end{array}\begin{array}{c}	ext {Marginal}\\underline{	ext {Product}}\0\14\12\9\7\4\2\end{array}\begin{array}{c}	ext { Product }\\underline{	ext { Price } }\\$ 3 \3 \3 \3 \3 \3 \3 \end{array}\begin{array}{c}\\underline{	ext {Employment}}\0\1\2\3\4\5\6 \end{array}\begin{array}{c}	ext { Wage}\\underline{	ext { Rate }} \ \$ 11 \11 \11 \11 \11 \11 \11\end{array}\end{array} Labor Demand Data ​ Labor Supply Data ​Employment​0123456​MarginalProduct​014129742​ Product  Price ​$3333333​Employment​0123456​ Wage Rate ​$11111111111111​​

Refer to the given data.The firm is hiring labor:

Accepted Answer

A)   at a wage rate that exceeds labor's MRP.
B)   under purely competitive conditions.
C)   in an imperfectly competitive market.
D)   as a monopsonist.

Question 6

The principal-agent problem arises in labor markets because:

Accepted Answer

A)   a firm may realize excessively large profits.
B)   workers may provide less-than-expected work effort.
C)   compensating wage differences do not pay for differences in the nonmonetary aspects of jobs.
D)   human capital investments vary among workers.

Question 7

Compensation paid in proportion to the number of units of personal output best describes:

Accepted Answer

A)   royalties.
B)   profit-sharing.
C)   bonuses.
D)   piece rates.

Question 8

Use the resource demand data shown on the left and the resource supply data on the right in answering the following question:   Labor Demand Data ‾ Labor Supply Data ‾Employment‾0123456MarginalProduct‾0152839485560 Product  Price ‾$2.202.001.801.601.401.201.00Employment‾0123456 Wage Rate ‾−−$1.002.003.004.005.006.00\begin{array}{c}\underline{	ext { Labor Demand Data }}\quad\quad\quad\quad\quad\quad\quad\quad\underline{	ext { Labor Supply Data }}\\begin{array}{c}\\underline{	ext {Employment}}\0\1\2\3\4\5\6\end{array}\begin{array}{c}	ext {Marginal}\\underline{	ext {Product}}\0\15\28\39\48\55\60\end{array}\begin{array}{c}	ext { Product }\\underline{	ext { Price } }\\$ 2.20 \2.00 \1.80 \1.60 \1.40 \1.20 \1.00 \end{array}\begin{array}{c}\\underline{	ext {Employment}}\0\1\2\3\4\5\6 \end{array}\begin{array}{c}	ext { Wage}\\underline{	ext { Rate }} \-- \\$1.00 \2.00\3.00 \4.00 \5.00 \6.00\end{array}\end{array} Labor Demand Data ​ Labor Supply Data ​Employment​0123456​MarginalProduct​0152839485560​ Product  Price ​$2.202.001.801.601.401.201.00​Employment​0123456​ Wage Rate ​−−$1.002.003.004.005.006.00​​ 
  Refer to the given data.We can conclude that:

Accepted Answer

A)   both the product and resource markets are imperfectly competitive.
B)   the resource market is imperfectly competitive,but the product market is purely competitive.
C)   both the resource and product markets are purely competitive.
D)   the resource market is purely competitive,but the product market is imperfectly competitive.

Question 9

Human capital is best defined as:

Accepted Answer

A)   the productive skills and knowledge that workers acquire from education and training.
B)   the substitution of labor for machinery in the production process.
C)   any piece of machinery that must be combined with labor to be productive.
D)   the exchange of money for real assets.

Question 10

A major function of the National Labor Relations Board is to:

Accepted Answer

A)   monitor potentially inflationary increases in wages.
B)   provide compulsory arbitration so that strikes and lockouts do not occur.
C)   set annual wage increases on an industry-by-industry basis.
D)   investigate and rule on charges of unfair labor practices by either management or unions.

Question 11

If a single large employer bargains with an inclusive union,the resulting labor market model can best be described as:

Accepted Answer

A)   a cartel.
B)   countervailing power.
C)   a bilateral monopoly.
D)   an internal labor market.

Question 12

Minimum-wage legislation is less likely to have adverse effects on employment when the:

Accepted Answer

A)   affected labor market is monopsonistic.
B)   economy has high unemployment.
C)   derived demand for labor is shifting to the left.
D)   affected labor market is perfectly competitive.

Question 13

The productivity and real wages of workers in industrially advanced economies have risen historically partly because:

Accepted Answer

A)   workers have acquired less education and training over time.
B)   workers have been able to use larger quantities of capital equipment.
C)   over time the capital equipment used by workers has deteriorated in quality.
D)   the supply of labor has increased.

Question 14

In 2011,the U.S.unionization rate was:

Accepted Answer

A)   5.5 percent,down by nearly one-half of the rate in the mid-1950s.
B)   14.8 percent,up by about one-fourth of the rate in the mid-1950s.
C)   11.8 percent,down by more than one-half of the rate in the mid-1950s.
D)   21.2 percent,down by 4 percentage points from the mid-1950s.

Question 15

(Last Word) Chief executive officers (CEOs) of large American corporations:

Accepted Answer

A)   have higher average salaries than CEOs of similar-size firms in other industrial nations.
B)   have similar salaries,on average,to CEOs of similar-size firms in other industrial nations.
C)   are,on average,older than CEOs of similar-size firms in other industrial nations.
D)   are,on average,younger than CEOs of similar-size firms in other industrial nations.

Question 16

Some economists claim that unions reduce economic efficiency by:

Accepted Answer

A)   providing a voice mechanism for workers.
B)   insisting that promotions be based on ability rather than seniority.
C)   imposing restrictions on the kinds of jobs workers may perform.
D)   increasing worker turnover.

Question 17

In 2011,approximately 5 percent of all work time lost was due to work stoppages.

Accepted Answer

A) True 
 B)False

Question 18

The labor supply curve facing a purely competitive employer is __________,whereas the labor supply curve facing a monopsonist is ___________.

Accepted Answer

A)   upsloping;horizontal
B)   downsloping;vertical
C)   vertical;upsloping
D)   horizontal;upsloping

Question 19

In the United States,the rate of unionization is:

Accepted Answer

A)   higher for sales workers than for transportation workers.
B)   lower for managers than for teachers.
C)   lower for production workers than for sales workers.
D)   higher for social workers than for protective service workers.

Question 20

Under an agency shop agreement,firms can hire:

Accepted Answer

A)   only union workers.
B)   nonunion workers,but these workers must join the union within a specified period,say,30 days.
C)   nonunion workers,but these workers must join the union within a specified period,pay union dues,or donate an equivalent amount to charity.
D)   only nonunion workers.

Exam 16: Wage Determination

Some economists claim that unions reduce economic efficiency by:

Correct Answer
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The labor supply curve facing a purely competitive employer is ,whereas the labor supply curve facing a monopsonist is _.

Correct Answer
verified

Piece-rates may not be appropriate pay in some situations because they might reduce product quality.

Correct Answer
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(Last Word) Chief executive officers (CEOs) of large American corporations:

Correct Answer
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Correct Answer
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In the United States,the rate of unionization is:

Correct Answer
verified

A major function of the National Labor Relations Board is to:

Correct Answer
verified

Correct Answer
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If a single large employer bargains with an inclusive union,the resulting labor market model can best be described as:

Correct Answer
verified

In 2011,the U.S.unionization rate was:

Correct Answer
verified

Which of the following tactics is most associated with the demand-enhancement union model?

Correct Answer
verified

Correct Answer
verified

Those who feel that unions positively affect productivity and efficiency argue that unions are:

Correct Answer
verified

Under an agency shop agreement,firms can hire:

Correct Answer
verified

In 2011,approximately 5 percent of all work time lost was due to work stoppages.

Correct Answer
verified

Minimum-wage legislation is less likely to have adverse effects on employment when the:

Correct Answer
verified

The principal-agent problem arises in labor markets because:

Correct Answer
verified

The productivity and real wages of workers in industrially advanced economies have risen historically partly because:

Correct Answer
verified

Human capital is best defined as:

Correct Answer
verified

Compensation paid in proportion to the number of units of personal output best describes:

Correct Answer
verified

Exam 16: Wage Determination

Some economists claim that unions reduce economic efficiency by:

Correct AnswerverifiedShow Answer

The labor supply curve facing a purely competitive employer is __________,whereas the labor supply curve facing a monopsonist is ___________.

Correct AnswerverifiedShow Answer

Piece-rates may not be appropriate pay in some situations because they might reduce product quality.

Correct AnswerverifiedShow Answer

(Last Word) Chief executive officers (CEOs) of large American corporations:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In the United States,the rate of unionization is:

Correct AnswerverifiedShow Answer

A major function of the National Labor Relations Board is to:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a single large employer bargains with an inclusive union,the resulting labor market model can best be described as:

Correct AnswerverifiedShow Answer

In 2011,the U.S.unionization rate was:

Correct AnswerverifiedShow Answer

Which of the following tactics is most associated with the demand-enhancement union model?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Those who feel that unions positively affect productivity and efficiency argue that unions are:

Correct AnswerverifiedShow Answer

Under an agency shop agreement,firms can hire:

Correct AnswerverifiedShow Answer

In 2011,approximately 5 percent of all work time lost was due to work stoppages.

Correct AnswerverifiedShow Answer

Minimum-wage legislation is less likely to have adverse effects on employment when the:

Correct AnswerverifiedShow Answer

The principal-agent problem arises in labor markets because:

Correct AnswerverifiedShow Answer

The productivity and real wages of workers in industrially advanced economies have risen historically partly because:

Correct AnswerverifiedShow Answer

Human capital is best defined as:

Correct AnswerverifiedShow Answer

Compensation paid in proportion to the number of units of personal output best describes:

Correct AnswerverifiedShow Answer

Correct Answer
verified

The labor supply curve facing a purely competitive employer is ,whereas the labor supply curve facing a monopsonist is _.

Correct Answer
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Correct Answer
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