Question 1

U.S.union membership has declined substantially in recent years.Which of the following is not usually cited as a causal factor?

Accepted Answer

A)  Most nonunion workers are in manufacturing industries.
B)  Import competition has reduced or restrained the growth of employment in some highly unionized industries.
C)  Some industries and firms have migrated to the less-unionized South.
D)  Managerial opposition to unions has intensified.E) B) and C)
F) A) and D)

Question 2

A firm might choose to pay its employees a wage higher than that which would clear the market because

Accepted Answer

A)  the higher wage raises the opportunity cost of shirking.
B)  the higher wage may shift the labor demand curve to the left.
C)  the firm will have higher turnover, allowing "new blood" to invigorate older workers, who have a greater tendency to shirk.
D)  this policy reduces the proportion of experienced to inexperienced workers, resulting in a lower overall wage bill.E) B) and C)
F) A) and C)

Question 3

Featherbedding refers to

Accepted Answer

A)  a situation in which a union forces an employer to hire union workers in preference to nonunion workers.
B)  the requirement that unneeded workers be retained on a job.
C)  the refusal by one union to handle or transport goods produced by workers in another union.
D)  disputes among two or more unions as to which will perform certain jobs.E) A) and B)
F) A) and C)

Question 4

According to international comparisons, which of these nations was not in the top 5 for hourly pay in U.S.dollar terms in 2013?

Accepted Answer

A)  Sweden
B)  Germany
C)  Australia
D)  United StatesE) None of the above
F) A) and B)

Question 5

The labor market for teachers in a small, isolated community that has one school district would be best described as a(n)

Accepted Answer

A)  natural monopoly.
B)  bilateral monopoly.
C)  monopsony.
D)  oligopsony.E) None of the above
F) C) and D)

Question 6

In monopsony situations, a minimum wage might increase wage and employment levels.

Accepted Answer

A) True 
 B)False

Question 7

In considering real-world situations, we must recognize the fact that by "wages" in this chapter, we mean the following, except the

Accepted Answer

A)  total price that employers pay to obtain labor.
B)  total income earned by households.
C)  total compensation of workers.
D)  total of direct payments and fringe benefits to workers.E) A) and D)
F) A) and C)

Question 8

According to the Conference Board data for 2013, which of the following nations had significantly higher hourly wages for production workers compared to the U.S.?

Accepted Answer

A)  Germany
B)  United Kingdom
C)  Japan
D)  CanadaE) None of the above
F) B) and C)

Question 9

The basic explanation for high real wages in the United States and other industrially advanced economies is that the

Accepted Answer

A)  labor supply has increased more rapidly than labor demand in these nations.
B)  labor demand has increased more rapidly than labor supply in these nations.
C)  unemployment in these nations has remained relatively stable over the years.
D)  inflation rate in these nations has been higher than the rate of increase in nominal wages.E) B) and C)
F) C) and D)

Question 10

Suppose a powerful labor union negotiates a wage for its members above the equilibrium wage rate in a nonunionized market.A likely result of this is that

Accepted Answer

A)  the union will have difficulty recruiting new members.
B)  union members will be able to work more overtime than before.
C)  this firm will make up for the higher wage rate by expanding output.
D)  not everyone who wants to work at the new wage will be able to find jobs.E) B) and C)
F) All of the above

Question 11

(Last Word)  Occupational licensing in the United States

Accepted Answer

A)  is required for a majority of jobs.
B)  is limited primarily to those jobs directly related to human health and safety.
C)  safeguards consumers in some industries, but in others is mostly a way to restrict entry and raise wages.
D)  has diminished in recent years as a result of industry deregulation.E) A) and B)
F) All of the above

Question 12

Marginal resource (labor) cost will exceed the wage rate when there is imperfect competition in the hiring of labor.

Accepted Answer

A) True 
 B)False

Question 13

A firm operating in a purely competitive resource market faces a resource supply curve that is

Accepted Answer

A)  perfectly inelastic.
B)  perfectly elastic.
C)  highly inelastic.
D)  highly elastic.E) A) and D)
F) A) and C)

Question 14

The monopsonist in a nonunionized labor market pays a wage rate below the MRP of labor.

Accepted Answer

A) True 
 B)False

Question 15

The rising general level of real wages in the United States has occurred because the growing population has increased the supply of labor relative to the demand for it.

Accepted Answer

A) True 
 B)False

Question 16

Marginal revenue product (MRP)  of labor refers to the

Accepted Answer

A)  increase in total revenue resulting from selling an additional unit of output.
B)  amount by which a firm's total resource cost increases when it employs one more unit of labor.
C)  increase in total revenue resulting from hiring one more unit of labor.
D)  price at which additional units of labor can be employed in a monopsonized labor market.E) None of the above
F) B) and D)

Question 17

A market where there is only a single buyer is called a(n)

Accepted Answer

A)  monopoly.
B)  monopsony.
C)  oligopoly.
D)  dominant firm.E) A) and B)
F) None of the above

Question 18

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.E) A) and C)
F) All of the above

Question 19

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 producingE) A) and D)
F) A) and C)

Question 20

One of the potential negative side effects of pay in the form of sales commissions is

Accepted Answer

A)  a greater incentive for salespeople to engage in unethical or fraudulent sales practices that may eventually cause legal problems for the firm.
B)  increased volatility of sales revenue for the firm.
C)  the potential that pay levels may get so high that they will increase a firm's marginal wage cost more than its marginal revenue product.
D)  an increased likelihood of shirking by workers.E) C) and D)
F) All of the above

Exam 17: Wage Determination

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

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According to the Conference Board data for 2013, which of the following nations had significantly higher hourly wages for production workers compared to the U.S.?

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The labor market for teachers in a small, isolated community that has one school district would be best described as a(n)

Correct AnswerverifiedShow Answer

A firm operating in a purely competitive resource market faces a resource supply curve that is

Correct AnswerverifiedShow Answer

According to international comparisons, which of these nations was not in the top 5 for hourly pay in U.S.dollar terms in 2013?

Correct AnswerverifiedShow Answer

(Last Word) Occupational licensing in the United States

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In considering real-world situations, we must recognize the fact that by "wages" in this chapter, we mean the following, except the

Correct AnswerverifiedShow Answer

The basic explanation for high real wages in the United States and other industrially advanced economies is that the

Correct AnswerverifiedShow Answer

A firm might choose to pay its employees a wage higher than that which would clear the market because

Correct AnswerverifiedShow Answer

Marginal resource (labor) cost will exceed the wage rate when there is imperfect competition in the hiring of labor.

Correct AnswerverifiedShow Answer

In monopsony situations, a minimum wage might increase wage and employment levels.

Correct AnswerverifiedShow Answer

Suppose a powerful labor union negotiates a wage for its members above the equilibrium wage rate in a nonunionized market.A likely result of this is that

Correct AnswerverifiedShow Answer

U.S.union membership has declined substantially in recent years.Which of the following is not usually cited as a causal factor?

Correct AnswerverifiedShow Answer

The rising general level of real wages in the United States has occurred because the growing population has increased the supply of labor relative to the demand for it.

Correct AnswerverifiedShow Answer

Marginal revenue product (MRP) of labor refers to the

Correct AnswerverifiedShow Answer

Featherbedding refers to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

One of the potential negative side effects of pay in the form of sales commissions is

Correct AnswerverifiedShow Answer

The monopsonist in a nonunionized labor market pays a wage rate below the MRP of labor.

Correct AnswerverifiedShow Answer

A market where there is only a single buyer is called a(n)

Correct AnswerverifiedShow Answer

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