Question 1

Economists would argue that the gender wage gap is narrowing because of efficiency wages.

Accepted Answer

A) True 
 B)False

Question 2

Evidence of differences in average wages of Aboriginal workers compared to white workers:

Accepted Answer

A)   is solely indicative of differences in productivity between races
B)   does not alone provide conclusive evidence of discrimination
C)   is seldom used to provide evidence of discriminatory bias
D)   provides conclusive evidence of broad patterns of discrimination on the basis of raceE) C) and D)
F) None of the above

Question 3

Economists who study labour markets have discovered that:

Accepted Answer

A)   only about five per cent of wage differences are related to chance
B)   ability, effort and chance are likely to be significant contributors to wage differences
C)   ability is not difficult to measure, but is largely insignificant in explaining wage differences
D)   work effort is difficult to measure, but is not likely to contribute much to an explanation of wage differencesE) C) and D)
F) All of the above

Question 4

Economists generally agree that:

Accepted Answer

A)   differences in average wages do not by themselves provide conclusive evidence about the magnitude of discrimination effects in labour markets
B)   discrimination is exclusively an economic, rather than political, phenomenon
C)   human capital theory provides the best explanation of discriminatory practices
D)   much of the wage differential observed in the economy is due to discriminationE) All of the above
F) A) and B)

Question 5

The alternative to human capital theory that explains why people invest in education argues that:

Accepted Answer

A)   schooling just acts as a signal of future ability
B)   university is a place to network with future workers
C)   productivity is not linked to wages
D)   people cannot be considered as 'capital'E) A) and B)
F) A) and C)

Question 6

The basic neoclassical theory of the labour market predicts that:

Accepted Answer

A)   wages are determined entirely by market supply
B)   workers are compensated according to their contribution to the social value of society
C)   workers earn a wage equal to the value they contribute to the economy
D)   wages are determined entirely by firms that demand labour servicesE) C) and D)
F) A) and C) C

Question 7

The ownership of human capital:

Accepted Answer

A)   is not generally transferable
B)   is easily transferable to multiple individuals
C)   is typically embodied in related physical capital
D)   may be subject to government restrictions on transferabilityE) All of the above
F) A) and B)

Question 8

Discrimination occurs when the marketplace offers different opportunities to similar individuals who differ only by:

Accepted Answer

A)   productivity
B)   experience
C)   gender
D)   any of the aboveE) A) and C)
F) None of the above C

Question 9

Economists are skeptical about the idea that discrimination is employer-driven for which of the following reasons?

Accepted Answer

A)   discrimination does not exist in markets
B)   holding productivity constant, a profit-maximising employer will hire the cheapest labour available
C)   rational employers are profit maximisers
D)   all of the aboveE) A) and C)
F) None of the above C

Question 10

From the perspective of market demand, human capital investment is reflected in:

Accepted Answer

A)   a firm's willingness to pay more for more productive workers
B)   a decrease in labour demand
C)   a decrease in the marginal product of labour
D)   all of the aboveE) B) and C)
F) A) and D)

Question 11

The high incomes for superstars in the movie market can be attributed to the fact that:

Accepted Answer

A)   there are not many good substitutes for the product offered
B)   people who become superstars have the best publicists
C)   superstars are very lucky individuals
D)   there are a lot less good movies being made at the momentE) B) and D)
F) B) and C)

Question 12

Hardworking employees generally do which of the following? (i)  they earn a higher wage than lazy employees
(ii)  they have higher marginal products
(iii)  they have more natural beauty

Accepted Answer

A)   (i)  and (ii) 
B)   (i)  and (iii) 
C)   (i) , (ii)  and (iii) 
D)   (ii)  and (iii) E) A) and B)
F) A) and C)

Question 13

Forestry worker wages are often higher than other low-skilled work because of the higher risks of injury or death.

Accepted Answer

A) True 
 B)False

Question 14

When workers form a labour union, the result will likely be which of the following? (i)  an increased demand for labour
(ii)  a surplus of labour
(iii)  increased unemployment

Accepted Answer

A)   (i)  and (ii) 
B)   (ii)  and (iii) 
C)   (i)  and (iii) 
D)   (i) , (ii)  and (iii) E) A) and D)
F) B) and C)

Question 15

Identify the statement below that would be an investment in human capital?

Accepted Answer

A)   a new fishing boat that can carry more crew
B)   a university degree
C)   the purchase of a larger trawling net to enhance labour productivity
D)   all of the aboveE) A) and D)
F) B) and C)

Question 16

Hypotheses described in the text, and that have been proposed to explain the rising wage gap between skilled and unskilled workers:

Accepted Answer

A)   may be reasonable explanations for a country whose technology and participation in world markets have remained constant over the relevant time period
B)   may be complementary to one another
C)   must be mutually exclusive
D)   are, in fact, the only possible explanations for the observed wage gapE) None of the above
F) A) and C)

Question 17

'The market for school teachers is clearly inefficient; if they were paid the value of marginal product, wages would be much higher'. Evaluate this statement.

Accepted Answer

The 'value' in value of marginal product...

Question 18

A union's major source of power is its:

Accepted Answer

A)   charismatic and experienced leader
B)   ability to withhold labour
C)   ability to bargain for shorter working weeks
D)   ability to shift the demand curve for labour to the rightE) A) and B)
F) A) and C)

Question 19

How does the theory of efficiency wages explain above-equilibrium wages?

Accepted Answer

A)   employers are forced to pay higher wages in efficient markets
B)   workers get a rise in wage when they prove they are increasing their productivity
C)   employers give their workers a higher wage in the hope that it will lead to increased productivity
D)   workers demand higher wages to compensate for poor fringe benefitsE) B) and D)
F) A) and D)

Question 20

Why can Roger Federer command a high sponsorship bonus?

Accepted Answer

Superstars arise in markets that have t...

Exam 20: Earnings, Unions and Discrimination

Economists would argue that the gender wage gap is narrowing because of efficiency wages.

Correct AnswerverifiedShow Answer

Evidence of differences in average wages of Aboriginal workers compared to white workers:

Correct AnswerverifiedShow Answer

Economists who study labour markets have discovered that:

Correct AnswerverifiedShow Answer

Economists generally agree that:

Correct AnswerverifiedShow Answer

The alternative to human capital theory that explains why people invest in education argues that:

Correct AnswerverifiedShow Answer

The basic neoclassical theory of the labour market predicts that:

Correct AnswerverifiedC

The ownership of human capital:

Correct AnswerverifiedShow Answer

Discrimination occurs when the marketplace offers different opportunities to similar individuals who differ only by:

Correct AnswerverifiedC

Economists are skeptical about the idea that discrimination is employer-driven for which of the following reasons?

Correct AnswerverifiedC

From the perspective of market demand, human capital investment is reflected in:

Correct AnswerverifiedShow Answer

The high incomes for superstars in the movie market can be attributed to the fact that:

Correct AnswerverifiedShow Answer

Hardworking employees generally do which of the following? (i) they earn a higher wage than lazy employees (ii) they have higher marginal products (iii) they have more natural beauty

Correct AnswerverifiedShow Answer

Forestry worker wages are often higher than other low-skilled work because of the higher risks of injury or death.

Correct AnswerverifiedShow Answer

When workers form a labour union, the result will likely be which of the following? (i) an increased demand for labour (ii) a surplus of labour (iii) increased unemployment

Correct AnswerverifiedShow Answer

Identify the statement below that would be an investment in human capital?

Correct AnswerverifiedShow Answer

Hypotheses described in the text, and that have been proposed to explain the rising wage gap between skilled and unskilled workers:

Correct AnswerverifiedShow Answer

'The market for school teachers is clearly inefficient; if they were paid the value of marginal product, wages would be much higher'. Evaluate this statement.

Correct AnswerverifiedThe 'value' in value of marginal product...View AnswerShow Answer

A union's major source of power is its:

Correct AnswerverifiedShow Answer

How does the theory of efficiency wages explain above-equilibrium wages?

Correct AnswerverifiedShow Answer

Why can Roger Federer command a high sponsorship bonus?

Correct AnswerverifiedSuperstars arise in markets that have t...View AnswerShow Answer

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The 'value' in value of marginal product...
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Superstars arise in markets that have t...
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