Question 1

Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power.

Accepted Answer

A) True 
 B)False

Question 2

Minimum-wage laws and unions are similar to each other but different from efficiency wages in that minimum-wage law and unions

Accepted Answer

A)   cause unemployment, but efficiency wages do not.
B)   cause the quantity of labor supplied to exceed the quantity of labor demanded, but efficiency wages do not.
C)   cause wages to be above the equilibrium level.
D)   prevent firms from lowering wages in the presence of a surplus of workers.E) None of the above
F) A) and D)

Question 3

Which of the following is not a contention of advocates of unions?

Accepted Answer

A)   Unions are a necessary antidote to the market power of the firms that hire workers.
B)   In the case of a "company town," a union may balance the firm's market power and protect the workers from being at the mercy of the firm's owners.
C)   The introduction of a union benefits all workers in a firm.
D)   Unions are important for helping firms respond efficiently to workers' concerns.E) All of the above
F) A) and B)

Question 4

People who report being not in the labor force but who, in fact, want to work but have given up trying to find a job after an unsuccessful search cause the reported unemployment rate to be lower than it would otherwise be.

Accepted Answer

A) True 
 B)False

Question 5

Table 28-2
Labor Data for Aridia
 
-Refer to Table 28-2. The unemployment rate of Aridia in 2010 was

Accepted Answer

A)   10%.
B)   12.5%.
C)   14.3%.
D)   80%.E) B) and D)
F) B) and C)

Question 6

Minimum-wage laws

Accepted Answer

A)   create unemployment.
B)   do not apply in states with right-to-work laws.
C)   affect highly-educated workers more than high school dropouts.
D)   cause labor shortages, which further raise wages above equilibrium.E) B) and C)
F) A) and D)

Question 7

Minimum wages are the predominant reason for unemployment in the U.S. economy.

Accepted Answer

A) True 
 B)False

Question 8

Since unemployment rates are consistently higher in Canada and some Western European countries than in the United States, it appears that the natural rate of unemployment is lower in the United States. What might explain this difference?

Accepted Answer

The text offers two explanations for the...

Question 9

The natural rate of unemployment is constant over time.

Accepted Answer

A) True 
 B)False

Question 10

The demand for labor by a certain firm is independent of the demand for that firm's product.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is correct?

Accepted Answer

A)   In the U.S. the natural rate of unemployment is frequently near 2%.
B)   The natural rate of unemployment fluctuates more than the cyclical rate of unemployment.
C)   The cyclical rate of unemployment is sometimes below the natural rate of unemployment.
D)   None of the above is correct.E) B) and D)
F) B) and C)

Question 12

The amount of unemployment that a country typically experiences is a determinant of its standard of living.

Accepted Answer

A) True 
 B)False

Question 13

Some long-run unemployment may be explained by the fact that the number of jobs available in some labor markets may be insufficient to give a job to everyone who wants one.

Accepted Answer

A) True 
 B)False

Question 14

Table 28-4
2010 Labor Data for Adults ages 16 and older)  in Meditor
 
-Refer to Table 28-4. What is the adult female labor-force participation rate in Meditor?

Accepted Answer

A)   38.1%
B)   61.9%
C)   66.7%
D)   95.2%E) A) and C)
F) All of the above

Question 15

Suppose that florists and landscape workers are not unionized. If florists unionize, then the wages of

Accepted Answer

A)   florists will rise, and the wages of landscape workers will fall.
B)   florists will fall, and the wages of landscape workers will rise.
C)   both florists and landscape workers will rise.
D)   both florists and landscape workers will fall.E) A) and C)
F) None of the above

Question 16

Suppose that there is an excess supply of economics professors. Should universities necessarily reduce salaries? What does standard economic theory suggest? What does efficiency-wage theory suggest?

Accepted Answer

Standard economic theory suggests that i...

Question 17

Table 28-3
2009 Labor Data for Baltivia
 
-Refer to Table 28-3. What was Baltivia's unemployment rate in 2009?

Accepted Answer

A)   8.0%
B)   12.7%
C)   15.9%
D)   22.1%E) C) and D)
F) A) and B)

Question 18

Public policy, without intending to do so, can increase frictional unemployment.

Accepted Answer

A) True 
 B)False

Question 19

Efficiency wages

Accepted Answer

A)   may increase productivity.
B)   will increase unemployment.
C)   may improve worker health.
D)   All of the above are correct.E) A) and B)
F) A) and C)

Question 20

Government-run employment agencies and public training programs are operated by the government to try to facilitate job search and reduce unemployment.

Accepted Answer

A)   Almost all economists agree that such programs are of no use.
B)   Almost all economists agree that such programs work very well.
C)   Some economists claim that the government can do these things no better than firms and individuals could do them for themselves.
D)   Some economists claim that these programs increase frictional unemployment.E) B) and D)
F) A) and B)

Exam 20: Unemployment

The natural rate of unemployment is constant over time.

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Suppose that there is an excess supply of economics professors. Should universities necessarily reduce salaries? What does standard economic theory suggest? What does efficiency-wage theory suggest?

Correct AnswerverifiedStandard economic theory suggests that i...View AnswerShow Answer

Table 28-2 Labor Data for Aridia -Refer to Table 28-2. The unemployment rate of Aridia in 2010 was

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Table 28-3 2009 Labor Data for Baltivia -Refer to Table 28-3. What was Baltivia's unemployment rate in 2009?

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Which of the following is correct?

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Since unemployment rates are consistently higher in Canada and some Western European countries than in the United States, it appears that the natural rate of unemployment is lower in the United States. What might explain this difference?

Correct AnswerverifiedThe text offers two explanations for the...View AnswerShow Answer

The demand for labor by a certain firm is independent of the demand for that firm's product.

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The amount of unemployment that a country typically experiences is a determinant of its standard of living.

Correct AnswerverifiedShow Answer

Minimum wages are the predominant reason for unemployment in the U.S. economy.

Correct AnswerverifiedShow Answer

People who report being not in the labor force but who, in fact, want to work but have given up trying to find a job after an unsuccessful search cause the reported unemployment rate to be lower than it would otherwise be.

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Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power.

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Government-run employment agencies and public training programs are operated by the government to try to facilitate job search and reduce unemployment.

Correct AnswerverifiedShow Answer

Which of the following is not a contention of advocates of unions?

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Suppose that florists and landscape workers are not unionized. If florists unionize, then the wages of

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Minimum-wage laws

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Minimum-wage laws and unions are similar to each other but different from efficiency wages in that minimum-wage law and unions

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Efficiency wages

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Table 28-4 2010 Labor Data for Adults ages 16 and older) in Meditor -Refer to Table 28-4. What is the adult female labor-force participation rate in Meditor?

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Public policy, without intending to do so, can increase frictional unemployment.

Correct AnswerverifiedShow Answer

Some long-run unemployment may be explained by the fact that the number of jobs available in some labor markets may be insufficient to give a job to everyone who wants one.

Correct AnswerverifiedShow Answer

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Standard economic theory suggests that i...
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The text offers two explanations for the...
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