Question 1

A minimum wage law tends to

Accepted Answer

A)  help all teenagers because they receive a higher wage than they would otherwise.
B)  have no impact on unemployment as long as it is set above the competitive equilibrium wage.
C)  create more unemployment in high-skill job markets than in low-skill job markets.
D)  create more unemployment in low-skill job markets than in high-skill job markets.E) All of the above
F) B) and C)

Question 2

A minimum wage is likely to have a greater impact on the market for skilled workers than on the market for unskilled workers.

Accepted Answer

A) True 
 B)False

Question 3

Suppose some country had an adult population of about 46 million, a labour force participation rate of 75 percent, and an unemployment rate of 8 percent.How many people were employed?

Accepted Answer

A)  2.76 million
B)  31.74 million
C)  34.5 million
D)  42.32 millionE) A) and B)
F) A) and C)

Question 4

Which of the following is a cost of unemployment to the individual?

Accepted Answer

A)  De-skilling.
B)  The tax and benefits effect.
C)  The reverse multiplier effect.
D)  The opportunity cost of unemployment.E) A) and D)
F) B) and C)

Question 5

The amount of unemployment that the economy normally experiences is known as

Accepted Answer

A)  the natural rate of unemployment.
B)  cyclical unemployment.
C)  efficiency wage unemployment.
D)  frictional unemployment.E) C) and D)
F) A) and C)

Question 6

Which of the following government policies would fail to lower the unemployment rate?

Accepted Answer

A)  Establishing worker training programs.
B)  Establishing right-to-work laws.
C)  Reducing unemployment benefits.
D)  Establishing employment agencies.
E)  Raising the minimum wage.F) A) and C)
G) D) and E)

Question 7

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 8

A husband who chooses to stay home and take care of the household is

Accepted Answer

A)  employed.
B)  not in the labour force.
C)  a discouraged worker.
D)  unemployed.E) C) and D)
F) A) and D)

Question 9

If, for any reason, the wage is held above the competitive equilibrium wage,

Accepted Answer

A)  the quantity of labour supplied will exceed the quantity of labour demanded and there will be unemployment.
B)  unions will likely strike and the wage will fall to equilibrium.
C)  the quantity of labour demanded will exceed the quantity of labour supplied and there will be a labour shortage.
D)  the quality of workers in the applicant pool will tend to fall.E) A) and C)
F) A) and B)

Question 10

It is difficult for cyclically unemployed persons to find jobs because

Accepted Answer

A)  they typically do not meet the qualifications required for the available jobs.
B)  the economy is in a recession.
C)  they voluntarily quit their last jobs and employers may view them as unreliable.
D)  they typically have not looked long enough to find a job.E) B) and C)
F) A) and D)

Question 11

The presence of a union tends to raise the wage for insiders and lower the wage for outsiders.

Accepted Answer

A) True 
 B)False

Question 12

Paying efficiency wages tends to increase worker turnover because workers can get continually higher wages if they change employer often.

Accepted Answer

A) True 
 B)False

Question 13

Unions attempt to raise wage rates for their members by

Accepted Answer

A)  Reducing the supply of the product their members produce.
B)  Lowering barriers to entry so their members have greater opportunities.
C)  Reducing the demand for labour so there are fewer non-union competitors.
D)  Negotiating a higher wage rate through collective bargaining.E) None of the above
F) A) and D)

Question 14

The natural rate of unemployment is the amount of unemployment that won't go away on its own, even in the long run.

Accepted Answer

A) True 
 B)False

Question 15

Unions tend to increase the disparity in pay between insiders and outsiders by

Accepted Answer

A)  increasing the wage in the unionized sector, which may create a decrease in the supply of workers in the non-unionized sector.
B)  increasing the demand for workers in the unionized sector.
C)  decreasing the demand for workers in the unionized sector.
D)  increasing the wage in the unionized sector, which may create an increase in the supply of workers in the non-unionized sector.E) A) and B)
F) A) and C)

Question 16

Unions may increase efficiency in some circumstances because they decrease the cost of bargaining between labour and management.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is a cost of unemployment to the economy?

Accepted Answer

A)  The opportunity cost of unemployment.
B)  The tax and benefits effect.
C)  The reverse multiplier effect.
D)  All of the above.E) B) and D)
F) A) and C)

Question 18

The labour force participation rate is computed as

Accepted Answer

A)  (Employed divided by Adult Population) ×100.
B)  (Employed divided by Labour Force) ×100.
C)  (Labour Force divided by Adult Population) ×100.
D)  (Adult Population divided by Labour Force) ×100.E) A) and B)
F) All of the above

Question 19

Teenage unemployment is higher than unemployment of people aged 20 and over.Explain why economists would attribute at least part of this difference to minimum wage laws.

Accepted Answer

People who are experienced and educated ...

Question 20

If the market for day care workers is in equilibrium at R5.00 per hour as shown in this diagram, a minimum wage of R8.00 per hour will increase unemployment by

Accepted Answer

A)  300 workers.
B)  500 workers.
C)  600 workers.
D)  No workers.E) A) and B)
F) C) and D)

Exam 6: Unemployment

Which of the following is a cost of unemployment to the individual?

Correct AnswerverifiedShow Answer

The labour force participation rate is computed as

Correct AnswerverifiedShow Answer

A husband who chooses to stay home and take care of the household is

Correct AnswerverifiedShow Answer

The presence of a union tends to raise the wage for insiders and lower the wage for outsiders.

Correct AnswerverifiedShow Answer

Which of the following government policies would fail to lower the unemployment rate?

Correct AnswerverifiedShow Answer

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

If, for any reason, the wage is held above the competitive equilibrium wage,

Correct AnswerverifiedShow Answer

Unions attempt to raise wage rates for their members by

Correct AnswerverifiedShow Answer

A minimum wage is likely to have a greater impact on the market for skilled workers than on the market for unskilled workers.

Correct AnswerverifiedShow Answer

Unions may increase efficiency in some circumstances because they decrease the cost of bargaining between labour and management.

Correct AnswerverifiedShow Answer

Unions tend to increase the disparity in pay between insiders and outsiders by

Correct AnswerverifiedShow Answer

Paying efficiency wages tends to increase worker turnover because workers can get continually higher wages if they change employer often.

Correct AnswerverifiedShow Answer

Which of the following is a cost of unemployment to the economy?

Correct AnswerverifiedShow Answer

The natural rate of unemployment is the amount of unemployment that won't go away on its own, even in the long run.

Correct AnswerverifiedShow Answer

Suppose some country had an adult population of about 46 million, a labour force participation rate of 75 percent, and an unemployment rate of 8 percent.How many people were employed?

Correct AnswerverifiedShow Answer

Teenage unemployment is higher than unemployment of people aged 20 and over.Explain why economists would attribute at least part of this difference to minimum wage laws.

Correct AnswerverifiedPeople who are experienced and educated ...View AnswerShow Answer

It is difficult for cyclically unemployed persons to find jobs because

Correct AnswerverifiedShow Answer

If the market for day care workers is in equilibrium at R5.00 per hour as shown in this diagram, a minimum wage of R8.00 per hour will increase unemployment by

Correct AnswerverifiedShow Answer

The amount of unemployment that the economy normally experiences is known as

Correct AnswerverifiedShow Answer

A minimum wage law tends to

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Standard economic theory suggests that i...
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

Correct Answer
verified
People who are experienced and educated ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified