Question 1

In a labour market free from discrimination,wages for workers that are employed by the same company will still differ.

Accepted Answer

A) True 
 B)False

Question 2

In what way do competitive markets have a natural remedy for discriminatory hiring practices

Accepted Answer

A)  Government naturally steps in to resolve problems of discrimination.
B)  Profit-maximizing firms that do not discriminate tend to replace firms that discriminate.
C)  Wages paid to groups that are victimized by discrimination are eventually bid up to above-equilibrium levels.
D)  Workers who receive a wage less than their marginal product will leave the firm.E) All of the above
F) B) and D)

Question 3

Explain the role of compensating differentials in explaining the difference between the average wages of men and women.

Accepted Answer

Men and women have traditionally selecte...

Question 4

When employers sort employment applications into high-ability and low-ability people based on the attainment of a university degree (irrespective of major) ,they are providing evidence in support of which of the following

Accepted Answer

A)  the human-capital theory of education
B)  the signalling theory of education
C)  the principle that education enhances marginal productivity
D)  the neoclassical principle that most business owners are more interested in discriminating against a particular group than in maximizing profitsE) B) and C)
F) C) and D)

Question 5

What does a signalling theory of education suggest

Accepted Answer

A)  Education is an important measure of human capital.
B)  Education is a signal of social status.
C)  Education does not necessarily increase productivity.
D)  Education necessarily increases productivity.E) A) and D)
F) B) and D)

Question 6

Scenario 19-2
Assume that the labour market for mechanics is competitive and that it is differentiated into two groups: male and female.Assume that the mechanics in this market have vehicle repair ability regardless of whether they are male or female.Currently, the equilibrium wage in the female market is lower than in the male market.Further assume that the market for vehicle repair is competitive.
-Refer to Scenario 19-2.If consumers do not discriminate between female mechanics and male mechanics,what will happen

Accepted Answer

A)  All mechanic shops will earn a normal economic profit.
B)  The difference in wages is able to be maintained since vehicle repair is not a homogeneous good.
C)  Mechanic shops that hire male mechanics will be more profitable than those that don't.
D)  Mechanic shops that hire female mechanics will be more profitable than those that don't.E) None of the above
F) A) and B)

Question 7

Why do major-league hockey players get paid more than minor-league players

Accepted Answer

A)  Major-league players are better athletes.
B)  The higher wage reflects a compensating differential.
C)  Playing in the major leagues is less pleasant than playing in the minor leagues.
D)  The higher wage is often due to talented agents.E) A) and C)
F) A) and D)

Question 8

Taxicab drivers in large cities are likely to earn more than taxicab drivers in rural areas.What could be one reason for this wage differential

Accepted Answer

A)  Driving a taxi in a large city is more dangerous than driving in a rural area.
B)  Driving in large cities is more exciting than driving in rural areas.
C)  Driving in a large city is easier than driving in a rural area.
D)  Drivers in a large city can work longer hours than those in a rural area.E) All of the above
F) B) and C)

Question 9

What is the main difference between human capital and physical capital

Accepted Answer

A)  Human capital is an important determinant of wages, but unlike physical capital, it plays no important role in the production of goods and services.
B)  Human capital is an important determinant of wages, and similar to physical capital, it plays an important role in the production of goods and services.
C)  Human capital is a specific type of physical capital.
D)  Human capital is 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) C) and D)

Question 10

Welding is a dangerous and dirty job.Suppose someone developed new machinery that made welding safer and cleaner at the same time it made welders more productive.What would we expect would happen to the wages of welders

Accepted Answer

A)  They would rise since labour productivity increases.
B)  They would fall since there is less demand for welders.
C)  They would rise if the change in the demand for welders is greater than the change in the supply of welders.
D)  They would fall if the change in the demand for welders is greater than the change in the supply of welders.E) A) and D)
F) B) and D)

Question 11

Some economists suggest that international trade has led to an expanding wage gap between high-skill and low-skill workers.

Accepted Answer

A) True 
 B)False

Question 12

Discrimination is an emotionally charged issue that is impossible to study objectively.

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

What have economists who study the value of skills in the labour markets documented

Accepted Answer

A)  a decrease in the earnings gap between low-skill and high-skill workers over the past 27 years in the United States but not in Canada
B)  an increase in the earnings gap between low-skill and high-skill workers over the past 27 years in Canada, but not in the United States
C)  a decrease in the earnings gap between low-skill and high-skill workers over the past 27 years in both Canada and the United States
D)  an increase in the earnings gap between low-skill and high-skill workers over the past 27 years in the United States, but not in CanadaE) A) and B)
F) A) and C)

Question 15

What does the basic neoclassical theory of the labour market predict

Accepted Answer

A)  Workers earn a wage equal to the value they contribute to the economy.
B)  Wages are determined entirely by market demand.
C)  Wages are determined entirely by market supply.
D)  Workers are compensated according to their contribution to the social value of society.E) B) and D)
F) None of the above

Question 16

Scenario 19-2
Assume that the labour market for mechanics is competitive and that it is differentiated into two groups: male and female.Assume that the mechanics in this market have vehicle repair ability regardless of whether they are male or female.Currently, the equilibrium wage in the female market is lower than in the male market.Further assume that the market for vehicle repair is competitive.
-Refer to Scenario 19-2.If consumers do not discriminate between male and female mechanics,what will result

Accepted Answer

A)  The equilibrium wage in both markets will be identical because of competitive pressure in the market for vehicle repair.
B)  The "female" market will eventually fall.
C)  The equilibrium wage in the "male" market will eventually rise.
D)  The equilibrium wage in the market for mechanics will not be reached.E) A) and D)
F) B) and C)

Question 17

In the country of Amazonia,men and women have the same level of education and choose different forms of work in the same proportions.The only real difference is that men typically stay home to raise the children.If no discrimination exists,then how would the wages of men and women compare on average

Accepted Answer

A)  Men and women would earn the same wage.
B)  Men would earn more than women.
C)  Men would earn less than women.
D)  Men would earn nothing.E) A) and B)
F) A) and C)

Question 18

Since a major-league baseball player makes more money than a private preschool teacher,what can we conclude

Accepted Answer

A)  Society values the services of a major-league baseball player more than the services of a private preschool teacher.
B)  A major-league baseball player generates more revenue in the economy than a private preschool teacher.
C)  Labour markets are generally inefficient and inequitable.
D)  Professional sport is more highly valued than preschool education.E) B) and C)
F) A) and B)

Question 19

What are business firms attempting to reward when they pay salespeople a percentage of their sales

Accepted Answer

A)  work effort
B)  loyalty to the firm
C)  years of schooling
D)  years of experienceE) B) and D)
F) B) and C)

Question 20

Explain the role consumers play in perpetuating discrimination in labour markets.

Accepted Answer

Consumers are able to exercise their bia...

Exam 19: Earnings and Discrimination

Since a major-league baseball player makes more money than a private preschool teacher,what can we conclude

Correct Answer
verified

What have economists who study the value of skills in the labour markets documented

Correct Answer
verified

Correct Answer
verified

What is the main difference between human capital and physical capital

Correct Answer
verified

Explain the role consumers play in perpetuating discrimination in labour markets.

Correct Answer
verified
Consumers are able to exercise their bia...
View Answer

When employers sort employment applications into high-ability and low-ability people based on the attainment of a university degree (irrespective of major) ,they are providing evidence in support of which of the following

Correct Answer
verified

In a labour market free from discrimination,wages for workers that are employed by the same company will still differ.

Correct Answer
verified

Discrimination is an emotionally charged issue that is impossible to study objectively.

Correct Answer
verified

What are business firms attempting to reward when they pay salespeople a percentage of their sales

Correct Answer
verified

Why do major-league hockey players get paid more than minor-league players

Correct Answer
verified

What does a signalling theory of education suggest

Correct Answer
verified

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

Correct Answer
verified

In what way do competitive markets have a natural remedy for discriminatory hiring practices

Correct Answer
verified

Explain the role of compensating differentials in explaining the difference between the average wages of men and women.

Correct Answer
verified
Men and women have traditionally selecte...
View Answer

Some economists suggest that international trade has led to an expanding wage gap between high-skill and low-skill workers.

Correct Answer
verified

Welding is a dangerous and dirty job.Suppose someone developed new machinery that made welding safer and cleaner at the same time it made welders more productive.What would we expect would happen to the wages of welders

Correct Answer
verified

What does the basic neoclassical theory of the labour market predict

Correct Answer
verified

Taxicab drivers in large cities are likely to earn more than taxicab drivers in rural areas.What could be one reason for this wage differential

Correct Answer
verified

Correct Answer
verified

In the country of Amazonia,men and women have the same level of education and choose different forms of work in the same proportions.The only real difference is that men typically stay home to raise the children.If no discrimination exists,then how would the wages of men and women compare on average

Correct Answer
verified

Exam 19: Earnings and Discrimination

Since a major-league baseball player makes more money than a private preschool teacher,what can we conclude

Correct AnswerverifiedShow Answer

What have economists who study the value of skills in the labour markets documented

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

What is the main difference between human capital and physical capital

Correct AnswerverifiedShow Answer

Explain the role consumers play in perpetuating discrimination in labour markets.

Correct AnswerverifiedConsumers are able to exercise their bia...View AnswerShow Answer

When employers sort employment applications into high-ability and low-ability people based on the attainment of a university degree (irrespective of major) ,they are providing evidence in support of which of the following

Correct AnswerverifiedShow Answer

In a labour market free from discrimination,wages for workers that are employed by the same company will still differ.

Correct AnswerverifiedShow Answer

Discrimination is an emotionally charged issue that is impossible to study objectively.

Correct AnswerverifiedShow Answer

What are business firms attempting to reward when they pay salespeople a percentage of their sales

Correct AnswerverifiedShow Answer

Why do major-league hockey players get paid more than minor-league players

Correct AnswerverifiedShow Answer

What does a signalling theory of education suggest

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

In what way do competitive markets have a natural remedy for discriminatory hiring practices

Correct AnswerverifiedShow Answer

Explain the role of compensating differentials in explaining the difference between the average wages of men and women.

Correct AnswerverifiedMen and women have traditionally selecte...View AnswerShow Answer

Some economists suggest that international trade has led to an expanding wage gap between high-skill and low-skill workers.

Correct AnswerverifiedShow Answer

Welding is a dangerous and dirty job.Suppose someone developed new machinery that made welding safer and cleaner at the same time it made welders more productive.What would we expect would happen to the wages of welders

Correct AnswerverifiedShow Answer

What does the basic neoclassical theory of the labour market predict

Correct AnswerverifiedShow Answer

Taxicab drivers in large cities are likely to earn more than taxicab drivers in rural areas.What could be one reason for this wage differential

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Consumers are able to exercise their bia...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Men and women have traditionally selecte...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified