Question 1

Scenario 19-2
Travis, a student at a community college, is considering what he should do for summer employment. Two recruiters show up at his school in search of summer workers. Recruiter A is looking for workers to help a disaster relief agency distribute food aid in Africa. Recruiter B is looking for custodial help to clean motel rooms in a motel located near the entrance to a famous national park.
-Refer to Scenario 19-2. Travis is carefully considering the options that each recruiter presents. On the basis of knowledge obtained in his economics class, Travis concludes that

Accepted Answer

A)   if the motel job requires some night shift work, wages will be lower than otherwise.
B)   the job that is more fun will have a higher wage.
C)   if the motel job doesn't require any special skills, the wage offer will be lower than otherwise.
D)   All of the above are correct.E) A) and B)
F) None of the above

Question 2

The most popular movie stars have high incomes for a number of reasons. One such reason is

Accepted Answer

A)   an ability for almost everyone to enjoy movies at a relatively low cost.
B)   the above-average intellect of the average movie star.
C)   a compensating differential.
D)   a lack of technological advances in the movie industry.E) A) and C)
F) A) and D)

Question 3

Which of the following is an example of a compensating differential?

Accepted Answer

A)   Two workers with different undergraduate majors earn different salaries.
B)   Two workers with different years of experience earn different salaries.
C)   Two workers whose jobs entail different risks earn different salaries.
D)   Two workers with different levels of personal attractiveness earn different salaries.E) A) and B)
F) All of the above

Question 4

Tiffany has just graduated from Stanford University and has applied for a job as an engineer at a manufacturing plant. The manufacturer decides to offer Tiffany a job because it perceives she's gained valuable skills while at Stanford. To which of the following views of education does the manufacturer subscribe?

Accepted Answer

A)   signaling
B)   human-capital view
C)   compensating-differentials
D)   superstarE) All of the above
F) C) and D)

Question 5

Which of the following is not an example of human capital for a college economics professor?

Accepted Answer

A)   years of experience
B)   a doctorate in economics
C)   chalk
D)   what the professor has learned from seminar courses on effective teaching methodsE) A) and B)
F) A) and C)

Question 6

Economists are skeptical that discrimination is employer driven because

Accepted Answer

A)   discrimination cannot exist in markets.
B)   employers are not really interested in maximizing profit.
C)   employers typically base wages paid on the prevailing market wage.
D)   holding productivity constant, a profit-maximizing employer will hire the cheapest labor available.E) A) and C)
F) B) and D)

Question 7

The fact that movie star Angelina Jolie's salary is much higher than the salary earned by the world's best nurse can best be explained by the

Accepted Answer

A)   failure of the market to reward talent fairly.
B)   large number of nurses.
C)   willingness of some people to accept a lower wage rate in order to do work they find personally rewarding.
D)   superstar phenomenon.E) A) and C)
F) None of the above

Question 8

Customer discrimination is illegal in the United States.

Accepted Answer

A) True 
 B)False

Question 9

If government regulations make a certain job less dangerous, then we'd expect that the supply of labor for that job would

Accepted Answer

A)   increase, which by itself would raise the wage for that job.
B)   increase, which by itself would reduce the wage for that job.
C)   decrease, which by itself would raise the wage for that joc.
D)   decrease, which by itself would reduce the wage for that job.E) All of the above
F) C) and D)

Question 10

The example of segregated streetcars in the southern United States in the early twentieth century is one example of

Accepted Answer

A)   racial discrimination by firms, despite government efforts to halt it.
B)   racial discrimination by firms with no government action either to halt it or to support it.
C)   government-mandated racial discrimination.
D)   a failure to find any discrimination where most would expect to find it.E) None of the above
F) All of the above

Question 11

Consumers are often a primary source of discrimination in labor markets.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following explains the "beauty premium" differences in wages?

Accepted Answer

A)   People who spend time on their personal appearance may send a signal that they are more productive workers.
B)   Personal appearance and intelligence are inversely related.
C)   The "superstar phenomenon" explains the "beauty premium."
D)   Better-looking people are more efficient; thus, they are paid an efficiency wage.E) A) and C)
F) C) and D)

Question 13

Studies of professional sports teams suggest that, in sports, racial discrimination in previous decades was

Accepted Answer

A)   rare.
B)   common and that owners of teams are largely to blame.
C)   common and that customers (fans)  are largely to blame.
D)   None of the above is correct; there are no reliable studies of discrimination in sports due to the difficulties inherent in measuring athletes' productivity.E) A) and C)
F) B) and C)

Question 14

In the early twentieth century, racial segregation of streetcars in the southern cities was largely opposed by

Accepted Answer

A)   streetcar firms.
B)   government officials.
C)   Federal lawyers applying the Sherman antitrust laws.
D)   consumers.E) All of the above
F) B) and C)

Question 15

Expenditures on human capital

Accepted Answer

A)   reflect an expectation of some future return on the investment.
B)   are generally embodied in a specific individual.
C)   reflect an investment of resources today to raise productivity in the future.
D)   All of the above are correct.E) All of the above
F) B) and C)

Question 16

Between 1975 and 2011, the wage gap between men with a high school education and men with a college education increased. In particular, in 2011 men with a college degree earned about

Accepted Answer

A)   10% more than men with a high school education.
B)   25% more than men with a high school education.
C)   75% more than men with a high school education.
D)   90% more than men with a high school education.E) A) and D)
F) All of the above

Question 17

Wages of doctors tend to be higher than wages of bankers. Which of the following is a compensating differential explaining the difference in wages?

Accepted Answer

A)   Doctors have the stress of being responsible for other peoples' lives while bankers do not.
B)   Doctors are on call to work nights and weekends, while bankers work traditional business hours.
C)   Doctors must pay for malpractice insurance in case they are sued for a mistake on the joc.
D)   All of the above are compensating differentials.E) A) and B)
F) None of the above

Question 18

According to the Hamermesh and Biddle study, people deemed more attractive than average earn

Accepted Answer

A)   30-40 percent more than unattractive people.
B)   about 5 percent more than average looking people.
C)   the same as average looking people and 15-20 percent more than unattractive people.
D)   25 percent more than average looking people and 50 percent more than unattractive people.E) A) and D)
F) A) and C)

Question 19

In the signaling theory of education,

Accepted Answer

A)   discrimination does not affect wage differentials.
B)   schooling makes workers more productive in the long-run.
C)   schooling makes workers more productive in the short-run.
D)   the worker signals to the employer that he is a valuable employee because he was willing to spend time to get an education.E) A) and C)
F) B) and D)

Question 20

If an employer's behavior is supportive of the theory of efficiency wages, the employer would

Accepted Answer

A)   raise wages in an effort to increase worker effort.
B)   raise wages in an effort to increase worker turnover.
C)   decrease wages in an effort to increase worker effort.
D)   decrease wages in an effort to increase worker turnover.E) A) and B)
F) C) and D)

Exam 19: Earnings and Discrimination

Between 1975 and 2011, the wage gap between men with a high school education and men with a college education increased. In particular, in 2011 men with a college degree earned about

Correct Answer
verified

If an employer's behavior is supportive of the theory of efficiency wages, the employer would

Correct Answer
verified

Wages of doctors tend to be higher than wages of bankers. Which of the following is a compensating differential explaining the difference in wages?

Correct Answer
verified

Consumers are often a primary source of discrimination in labor markets.

Correct Answer
verified

The most popular movie stars have high incomes for a number of reasons. One such reason is

Correct Answer
verified

Which of the following explains the "beauty premium" differences in wages?

Correct Answer
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Expenditures on human capital

Correct Answer
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Economists are skeptical that discrimination is employer driven because

Correct Answer
verified

The fact that movie star Angelina Jolie's salary is much higher than the salary earned by the world's best nurse can best be explained by the

Correct Answer
verified

In the signaling theory of education,

Correct Answer
verified

The example of segregated streetcars in the southern United States in the early twentieth century is one example of

Correct Answer
verified

Which of the following is not an example of human capital for a college economics professor?

Correct Answer
verified

Correct Answer
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If government regulations make a certain job less dangerous, then we'd expect that the supply of labor for that job would

Correct Answer
verified

In the early twentieth century, racial segregation of streetcars in the southern cities was largely opposed by

Correct Answer
verified

Which of the following is an example of a compensating differential?

Correct Answer
verified

Customer discrimination is illegal in the United States.

Correct Answer
verified

According to the Hamermesh and Biddle study, people deemed more attractive than average earn

Correct Answer
verified

Studies of professional sports teams suggest that, in sports, racial discrimination in previous decades was

Correct Answer
verified

Correct Answer
verified

Exam 19: Earnings and Discrimination

Between 1975 and 2011, the wage gap between men with a high school education and men with a college education increased. In particular, in 2011 men with a college degree earned about

Correct AnswerverifiedShow Answer

If an employer's behavior is supportive of the theory of efficiency wages, the employer would

Correct AnswerverifiedShow Answer

Wages of doctors tend to be higher than wages of bankers. Which of the following is a compensating differential explaining the difference in wages?

Correct AnswerverifiedShow Answer

Consumers are often a primary source of discrimination in labor markets.

Correct AnswerverifiedShow Answer

The most popular movie stars have high incomes for a number of reasons. One such reason is

Correct AnswerverifiedShow Answer

Which of the following explains the "beauty premium" differences in wages?

Correct AnswerverifiedShow Answer

Expenditures on human capital

Correct AnswerverifiedShow Answer

Economists are skeptical that discrimination is employer driven because

Correct AnswerverifiedShow Answer

The fact that movie star Angelina Jolie's salary is much higher than the salary earned by the world's best nurse can best be explained by the

Correct AnswerverifiedShow Answer

In the signaling theory of education,

Correct AnswerverifiedShow Answer

The example of segregated streetcars in the southern United States in the early twentieth century is one example of

Correct AnswerverifiedShow Answer

Which of the following is not an example of human capital for a college economics professor?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If government regulations make a certain job less dangerous, then we'd expect that the supply of labor for that job would

Correct AnswerverifiedShow Answer

In the early twentieth century, racial segregation of streetcars in the southern cities was largely opposed by

Correct AnswerverifiedShow Answer

Which of the following is an example of a compensating differential?

Correct AnswerverifiedShow Answer

Customer discrimination is illegal in the United States.

Correct AnswerverifiedShow Answer

According to the Hamermesh and Biddle study, people deemed more attractive than average earn

Correct AnswerverifiedShow Answer

Studies of professional sports teams suggest that, in sports, racial discrimination in previous decades was

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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