Question 1

Experimental evidence indicates women choose less competitive environments than men.

Accepted Answer

A) True 
 B)False

Question 2

A 1990 study of the market for collectable baseball cards suggested

Accepted Answer

A)  there was no evidence of price discrimination on the basis of player position (hitter versus pitcher) .
B)  markets in which the product price is low are not typically characterized by consumer-driven race discrimination.
C)  cards for white players (both hitters and pitchers)  were 10 to 13 percent higher than those for comparable black players.
D)  cards for black players (both hitters and pitchers)  were 10 to 13 percent higher than those for comparable white players.E) All of the above
F) None of the above

Question 3

Table 19-2  Source: US Census Bureau and Mankiw's calculations
-Refer to Table 19-2. In 2011, on average how much more income would a man with a college degree earn than a man with a high school degree?

Accepted Answer

The answer of Table 19-2  Source: US Census Bureau...

Question 4

A study by labor economists Hamermesh and Biddle found that

Accepted Answer

A)  shorter-than-average men earn more than shorter-than-average women, all else equal.
B)  above-average looking people earn more than average-looking people, all else equal.
C)  shorter women earn more than taller women, all else equal.
D)  All of the above are correct.E) A) and C)
F) None of the above

Question 5

Which term do economists use to refer to a difference in wages that arises from nonmonetary characteristics of different jobs?

Accepted Answer

A)  non-pecuniary differentials
B)  compensating differentials
C)  fundamental differences
D)  idiosyncratic differencesE) A) and B)
F) All of the above

Question 6

Which of the following does not affect the wages a worker earns?

Accepted Answer

A)  natural ability
B)  effort
C)  chance
D)  All of the above affect the wages a worker earns.E) None of the above
F) A) and B)

Question 7

A manager of a small firm who believes in the signaling theory of education would encourage her employees to obtain additional education to raise their on-the-job productivity.

Accepted Answer

A) True 
 B)False

Question 8

Differences in human capital among workers can often be attributed to social or political processes rather than economic processes.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following comparisons best illustrates a compensating differential?

Accepted Answer

A)  John's wage is higher than Jane's because the value of John's marginal product is higher than Jane's.
B)  Karl's wage is higher than Kay's because Karl is very personable, and Kay is very gruff.
C)  Beth's wage is higher than Bill's because Beth's job may cause long-term health problems, and Bill's job will not impair his health.
D)  All of the above are good illustrations of compensating differentials.E) C) and D)
F) A) and C)

Question 10

Which of the following sets of circumstances is likely to provide the best evidence in support of the theory of efficiency wages?

Accepted Answer

A)  Workers in the market are unskilled and not represented by a union, and their wage exceeds both the equilibrium wage and the minimum wage.
B)  Workers in the market are highly skilled and not represented by a union, and their wage exceeds the minimum wage.
C)  Workers in the market are highly skilled and represented by a union, and their wage exceeds the equilibrium wage.
D)  Employers in the market are known for reducing the workers' wage whenever they get an opportunity to do so.E) None of the above
F) A) and B)

Question 11

Studies of discrimination in baseball suggest that black players

Accepted Answer

A)  suffered from discriminatory wage differentials several decades ago and those wage differentials persist today.
B)  suffered from discriminatory wage differentials several decades ago but those wage differentials have been eliminated.
C)  did not suffer from discriminatory wage differentials several decades ago but in recent years wage differentials have become evident.
D)  did not suffer from discriminatory wage differentials in the past and they do not suffer from wage differentials today.E) A) and D)
F) A) and C)

Question 12

Evaluate the following statement: "The gender pay gap provides evidence of widespread, severe, ongoing discrimination by employers and fellow workers."

Accepted Answer

There are many explanations of the gende...

Question 13

Other things equal, one would predict that market wages would be relatively high when

Accepted Answer

A)  the supply of labor is high.
B)  the demand for labor is low.
C)  the supply of labor is low.
D)  Both (a.)  and (b.)  are correctE) B) and C)
F) A) and D)

Question 14

Labor-market discrimination based solely on age is illegal in the United States.

Accepted Answer

A) True 
 B)False

Question 15

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

Accepted Answer

A)  Employers are forced by competition to pay higher wages in efficient markets.
B)  Employers give their workers a higher wage in the hope that it will lead to increased productivity.
C)  Workers get higher wages when they prove they are increasing their productivity.
D)  Workers demand higher wages to compensate for poor fringe benefits.E) B) and D)
F) C) and D)

Question 16

Men and women tend to choose different types of occupations, and so

Accepted Answer

A)  a source of wage differences between men and women is differences in human capital.
B)  a source of wage differences between men and women is compensating differentials.
C)  the gap between the earnings of men and the earnings of women is likely even more significant than the data alone indicate.
D)  we should expect the earnings of women to rise relative to the earnings of men, in order to induce women to accept jobs that they have been reluctant to accept in the past.E) A) and B)
F) A) and D)

Question 17

Coal mining is a dangerous and dirty job. Suppose someone developed new machinery that made coal mining safer and cleaner; at the same time, suppose it made coal miners more productive. We would expect that the wages of coal miners would

Accepted Answer

A)  rise.
B)  fall.
C)  stay exactly the same.
D)  rise, fall, or stay the same.E) C) and D)
F) None of the above

Question 18

Some economists hypothesize that international trade has altered the relative demand for skilled and unskilled labor, changing the gap in earnings between these two groups. Which of the following statements best describes this hypothesis?

Accepted Answer

A)  Unskilled labor is plentiful and cheap in the US, so the US tends to export goods produced with unskilled labor and import goods produced with skilled labor.
B)  Unskilled labor is plentiful and cheap in many foreign countries, so the US tends to import goods produced with unskilled labor and export goods produced with skilled labor.
C)  Computers raise the demand for skilled workers and reduce the demand for the unskilled workers whose jobs are replaced by the computers.
D)  Greater demand for skilled labor has led to higher wages for those workers and greater demand for imported products.E) A) and D)
F) All of the above

Question 19

It is increasingly clear that technological change is the only explanation for an expanding wage gap between high-skill and low-skill workers.

Accepted Answer

A) True 
 B)False

Question 20

People who grew up in the western part of Aquilonia have an accent distinct from people who grew up in the eastern part of the country. People from the west also receive lower wages than people from the east. From this information alone, we can conclude that it is possible that

Accepted Answer

A)  discrimination against people from the west exists.
B)  people from the east receive compensating differentials.
C)  people from the west have lower levels of human capital.
D)  All of the above could be correct.E) All of the above
F) C) and D)

Exam 19: Earnings and Discrimination

Labor-market discrimination based solely on age is illegal in the United States.

Correct AnswerverifiedShow Answer

Experimental evidence indicates women choose less competitive environments than men.

Correct AnswerverifiedShow Answer

Coal mining is a dangerous and dirty job. Suppose someone developed new machinery that made coal mining safer and cleaner; at the same time, suppose it made coal miners more productive. We would expect that the wages of coal miners would

Correct AnswerverifiedShow Answer

A study by labor economists Hamermesh and Biddle found that

Correct AnswerverifiedShow Answer

Evaluate the following statement: "The gender pay gap provides evidence of widespread, severe, ongoing discrimination by employers and fellow workers."

Correct AnswerverifiedThere are many explanations of the gende...View AnswerShow Answer

Which of the following does not affect the wages a worker earns?

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Table 19-2 Source: US Census Bureau and Mankiw's calculations -Refer to Table 19-2. In 2011, on average how much more income would a man with a college degree earn than a man with a high school degree?

Correct AnswerverifiedShow Answer

A manager of a small firm who believes in the signaling theory of education would encourage her employees to obtain additional education to raise their on-the-job productivity.

Correct AnswerverifiedShow Answer

Which of the following comparisons best illustrates a compensating differential?

Correct AnswerverifiedShow Answer

Which term do economists use to refer to a difference in wages that arises from nonmonetary characteristics of different jobs?

Correct AnswerverifiedShow Answer

Which of the following sets of circumstances is likely to provide the best evidence in support of the theory of efficiency wages?

Correct AnswerverifiedShow Answer

Some economists hypothesize that international trade has altered the relative demand for skilled and unskilled labor, changing the gap in earnings between these two groups. Which of the following statements best describes this hypothesis?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

It is increasingly clear that technological change is the only explanation for an expanding wage gap between high-skill and low-skill workers.

Correct AnswerverifiedShow Answer

Studies of discrimination in baseball suggest that black players

Correct AnswerverifiedShow Answer

A 1990 study of the market for collectable baseball cards suggested

Correct AnswerverifiedShow Answer

People who grew up in the western part of Aquilonia have an accent distinct from people who grew up in the eastern part of the country. People from the west also receive lower wages than people from the east. From this information alone, we can conclude that it is possible that

Correct AnswerverifiedShow Answer

Other things equal, one would predict that market wages would be relatively high when

Correct AnswerverifiedShow Answer

Men and women tend to choose different types of occupations, and so

Correct AnswerverifiedShow Answer

Differences in human capital among workers can often be attributed to social or political processes rather than economic processes.

Correct AnswerverifiedShow Answer

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There are many explanations of the gende...
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