Question 1

The human-capital theory of education maintains that workers who complete specific levels of education enhance their productivity through education.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements is correct?

Accepted Answer

A)  Differences in human capital may explain differences in wages between blacks and whites.
B)  Racial discrimination is the strongest explanation for differences in wages between blacks and whites.
C)  Gender discrimination is the strongest explanation for differences in wages between blacks and whites.
D)  None of the above statements is correct.E) A) and B)
F) A) and D)

Question 3

Tom, the manager and owner of a small company, believes in the signaling theory of education, not the human capital theory. As such, we would expect Tom not to offer which of the following company benefits?

Accepted Answer

A)  employer-matching 401k retirement plan contributions
B)  tuition reimbursement for workers who take college classes
C)  on-site day care
D)  health insuranceE) B) and C)
F) B) and D)

Question 4

Business owners who care only about making money are

Accepted Answer

A)  likely to discriminate against certain groups of workers.
B)  likely to be replaced by discriminating businesses.
C)  more concerned about racial discrimination than gender discrimination.
D)  at an advantage when competing against those who practice discrimination.E) A) and B)
F) None of the above

Question 5

The theory of efficiency wages suggests that

Accepted Answer

A)  above-equilibrium wages increase worker productivity.
B)  workers with higher levels of education earn more than workers with lower levels of education.
C)  workers signal their high ability to potential employers by completing formal years of schooling.
D)  union workers earn more than nonunion workers.E) A) and D)
F) None of the above

Question 6

Park rangers at Yellowstone National Park are known to have low wages. This is probably because

Accepted Answer

A)  park rangers are required to be college graduates.
B)  park rangers don't need much money to live.
C)  park ranger jobs are perceived to be dangerous.
D)  park ranger jobs are perceived to be "fun."E) B) and D)
F) A) and C)

Question 7

Human capital is

Accepted Answer

A)  an important determinant of wages, but it does not affect the production of goods and services.
B)  an important determinant of wages, and it affects the production of goods and services.
C)  a specific type of physical capital made by humans rather than machines.
D)  very different from physical capital in that physical capital represents an investment, while human capital does not represent an investment.E) B) and D)
F) A) and B)

Question 8

According to the superstar phenomenon, the most talented person in the following occupations is likely to earn extremely high wages except

Accepted Answer

A)  an author.
B)  an auto mechanic.
C)  a singer.
D)  an advice columnist.E) A) and B)
F) A) and C)

Question 9

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.E) A) and C)
F) A) and B)

Question 10

The characteristics of jobs and workers affect

Accepted Answer

A)  labor supply.
B)  labor demand.
C)  equilibrium wages.
D)  All of the above are correct.E) B) and C)
F) A) and B)

Question 11

If there is systematic discrimination against a group of workers, then the wage paid to those workers likely will be

Accepted Answer

A)  lower due to a higher supply of workers in that group.
B)  lower due to a lower demand for workers in that group.
C)  higher due to a lower supply of workers in that group.
D)  higher due to a higher demand for workers in that group.E) B) and D)
F) A) and C)

Question 12

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.E) B) and C)
F) A) and D)

Question 13

A group of firms working together and acting as a supplier of a product is called a cartel. A group of employees working together and acting as a single supplier of labor is called a

Accepted Answer

The answer of A group of firms working together and...

Question 14

The belief that education makes a person more productive and thereby raises his or her wage is referred to as the

Accepted Answer

A)  signaling view of education.
B)  natural-ability view of education.
C)  unmeasured-variables view of education.
D)  human-capital view of education.E) A) and C)
F) A) and B)

Question 15

Figure 19-5 
-Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Accepted Answer

A)  Fewer workers are employed, but those who are employed earn a higher wage.
B)  More workers are employed but they earn a lower wage.
C)  More workers are employed and they earn a higher wage.
D)  The same number of workers are employed and they earn a higher wage.E) All of the above
F) B) and C)

Question 16

The signaling theory of education maintains that workers who complete specific levels of education enhance their productivity through education.

Accepted Answer

A) True 
 B)False

Question 17

A computer is an example of human capital.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is not an example of a compensating differential?

Accepted Answer

A)  paying workers who do dull, boring work higher wages than workers who do fun, interesting work, all else equal
B)  paying workers who work on the night shift higher wages than workers who work the day shift, all else equal
C)  paying workers who do more dangerous work higher wages than workers who do less dangerous work, all else equal
D)  paying workers with PhDs higher wages than workers with BAs, all else equalE) A) and C)
F) B) and C)

Question 19

When firms focus on profit maximization, which form of wage discrimination is least likely to occur?

Accepted Answer

A)  discrimination based on race
B)  discrimination in sports
C)  consumer discrimination
D)  discrimination based on educational attainmentE) A) and B)
F) A) and C)

Question 20

Bob, the manager and owner of a small company, believes in the theory of efficiency wages. As such, Bob would be most likely to agree with which of the following quotes?

Accepted Answer

A)  "The only place where success comes before work is in the dictionary."
B)  "Work hard. Play harder."
C)  "Pay a man for the job you want him to do."
D)  "Imagination is more important than knowledge."E) A) and B)
F) None of the above

Exam 19: Earnings and Discrimination

Tom, the manager and owner of a small company, believes in the signaling theory of education, not the human capital theory. As such, we would expect Tom not to offer which of the following company benefits?

Correct AnswerverifiedShow Answer

The theory of efficiency wages suggests that

Correct AnswerverifiedShow Answer

When firms focus on profit maximization, which form of wage discrimination is least likely to occur?

Correct AnswerverifiedShow Answer

Park rangers at Yellowstone National Park are known to have low wages. This is probably because

Correct AnswerverifiedShow Answer

A signaling theory of education suggests that

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The human-capital theory of education maintains that workers who complete specific levels of education enhance their productivity through education.

Correct AnswerverifiedShow Answer

A computer is an example of human capital.

Correct AnswerverifiedShow Answer

The belief that education makes a person more productive and thereby raises his or her wage is referred to as the

Correct AnswerverifiedShow Answer

Business owners who care only about making money are

Correct AnswerverifiedShow Answer

Which of the following is not an example of a compensating differential?

Correct AnswerverifiedShow Answer

Bob, the manager and owner of a small company, believes in the theory of efficiency wages. As such, Bob would be most likely to agree with which of the following quotes?

Correct AnswerverifiedShow Answer

Figure 19-5 -Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Correct AnswerverifiedShow Answer

The signaling theory of education maintains that workers who complete specific levels of education enhance their productivity through education.

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

Correct AnswerverifiedShow Answer

A group of firms working together and acting as a supplier of a product is called a cartel. A group of employees working together and acting as a single supplier of labor is called a

Correct AnswerverifiedShow Answer

Human capital is

Correct AnswerverifiedShow Answer

According to the superstar phenomenon, the most talented person in the following occupations is likely to earn extremely high wages except

Correct AnswerverifiedShow Answer

If there is systematic discrimination against a group of workers, then the wage paid to those workers likely will be

Correct AnswerverifiedShow Answer

The characteristics of jobs and workers affect

Correct AnswerverifiedShow Answer

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