Question 1

A plumber who specializes in cleaning plugged sewer lines is typically paid a higher wage than a plumber who works on installing water systems in new residential housing. Which of the following would push the wages of plumbers who work on sewer lines higher?

Accepted Answer

A)   Plumbers who work on new residential housing require more training than plumbers working on sewer lines.
B)   Plumbing jobs that involve sewer lines are likely to have a high element of personal satisfaction.
C)   Plumbers who work with sewer lines are more likely to work the day shift.
D)   plumbers who work with sewer lines are likely to be perceived as having a "dirty" job.E) B) and D)
F) C) and D)

Question 2

Figure 19-5 
-Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Accepted Answer

A)   Fewer workers are employed, but those who are employed earn a higher wage.
B)   More workers are employed but they earn a lower wage.
C)   More workers are employed and they earn a higher wage.
D)   The same number of workers are employed and they earn a higher wage.E) A) and B)
F) B) and C)

Question 3

Name two occupations that have the two characteristics required for the superstar phenomenon.

Accepted Answer

The answer of Name two occupations that have the two...

Question 4

It is likely that, if we could measure the quality as well as the quantity of education,

Accepted Answer

A)   the human-capital argument would become less compelling as a means of explaining wage differentials between white workers and black workers.
B)   the human-capital argument would become less compelling as a means of explaining wage differentials between male workers and female workers.
C)   wage differentials between white workers and black workers would be more puzzling than they are now.
D)   wage differentials between white workers and black workers would be more fully explained.E) A) and D)
F) A) and C)

Question 5

Figure 19-5 
-Refer to Figure 19-5. Given demand for labor, D1, and supply of labor, S2, what is the surplus of labor if a minimum wage of $8 per hour is imposed on this market?

Accepted Answer

A)   100
B)   200
C)   300
D)   400E) B) and C)
F) A) and B)

Question 6

Is measuring the effect of discrimination on wages relatively easy or relatively difficult? Explain?

Accepted Answer

It can be relatively difficult...

Question 7

Among male workers over age 25, about what percent has a college degree? What is this percentage for black male workers over age 25?

Accepted Answer

The answer of Among male workers over age 25, about...

Question 8

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 9

The very high pay earned by the best actors and actresses is partially explained by the fact that

Accepted Answer

A)   they benefit from a compensating differential.
B)   moviegoers all want to see the very best actors, not second-rate actors.
C)   they have acting degrees from accredited acting schools.
D)   the supply of good actors is very large.E) C) and D)
F) B) and D)

Question 10

The superstar phenomenon explains why professional athletes earn more than amateur athletes.

Accepted Answer

A) True 
 B)False

Question 11

One of the problems with calculating the true amount of discrimination that takes place in the market for labor is

Accepted Answer

A)   the inability to calculate wage differentials.
B)   the inability to see changes in the wage differentials over a period of time.
C)   the difficulty in measuring productivity differences between workers.
D)   the difficulty in measuring female labor-force participation.E) A) and B)
F) A) and C)

Question 12

Figure 19-4 
-Refer to Figure 19-4. If a union is successful in reducing supply from S1 to S2, the wage will

Accepted Answer

A)   rise from $15 per hour to $18 per hour and 100 fewer people will be employed.
B)   rise from $15 per hour to $18 per hour and 200 more people will be employed.
C)   fall from $15 per hour to $12 per hour and 100 more people will be employed.
D)   fall from $18 per hour to $15 per hour and 200 fewer people will be employed.E) C) and D)
F) None of the above

Question 13

A consensus view among economists regarding the possibility of labor-market discrimination is that

Accepted Answer

A)   most wage differences among groups are attributable to discrimination.
B)   many employers use compensating differentials to hide discriminatory practices.
C)   wage differences among groups are not sufficient by themselves to determine how much discrimination there is.
D)   all wage differences among groups are attributable to differences in human capital and compensating differentials.E) A) and B)
F) A) and C)

Question 14

Why is a construction worker never likely to earn as much as a famous athlete?

Accepted Answer

A)   Compensating differentials create a higher wage for professional athletes.
B)   Technological progress has advanced less in the construction industry then in sports training.
C)   Productivity levels are low in the construction industry due to the high number of people willing to be construction workers.
D)   A construction worker can provide his services to only a limited number of customers.E) A) and B)
F) B) and C)

Question 15

Workers with more human capital on average earn substantially higher pay than workers with less human capital in

Accepted Answer

A)   most countries but not in the United States.
B)   the United States but not in most other countries.
C)   the United States and in most other countries.
D)   None of the above is correct; the evidence fails to indicate that human capital is a significant factor in determining earnings anywhere in the world.E) All of the above
F) B) and C)

Question 16

Why would a wage differential due to discrimination in hiring be unlikely to persist in a competitive labor market?

Accepted Answer

A)   There is a cost advantage for firms that do not discriminate.
B)   Workers who are victims of discrimination will eventually drop out of the labor market.
C)   Competing firms will hire fewer of the workers who are temporarily victimized by discrimination.
D)   Discrimination cannot exist in markets.E) All of the above
F) B) and C)

Question 17

A natural correction to employer discrimination in market economies is the

Accepted Answer

A)   threat of judicial review.
B)   profit motive.
C)   political process.
D)   union movement.E) None of the above
F) B) and D)

Question 18

Economists generally agree that

Accepted Answer

A)   human capital theory provides the best explanation of discriminatory practices.
B)   differences in average wages do not by themselves provide conclusive evidence about the magnitude of discrimination in labor markets.
C)   discrimination is exclusively an economic, rather than political, phenomenon.
D)   most of the wage differentials observed in the U.S. economy are due to discrimination.E) B) and C)
F) A) and D)

Question 19

Economists who attempt to explain the increasing earnings gap between skilled and unskilled workers offer two main hypotheses:

Accepted Answer

A)   one hypothesis emphasizes education, and the other emphasizes compensating differentials.
B)   one hypothesis emphasizes education, and the other international trade.
C)   one hypothesis emphasizes international trade, and the other emphasizes technology.
D)   one hypothesis emphasizes technology, and the other emphasizes compensating differentials.E) A) and B)
F) A) and C)

Question 20

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

Exam 19: Earnings and Discrimination

Name two occupations that have the two characteristics required for the superstar phenomenon.

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

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

Why would a wage differential due to discrimination in hiring be unlikely to persist in a competitive labor market?

Correct AnswerverifiedShow Answer

A consensus view among economists regarding the possibility of labor-market discrimination is that

Correct AnswerverifiedShow Answer

Why is a construction worker never likely to earn as much as a famous athlete?

Correct AnswerverifiedShow Answer

It is likely that, if we could measure the quality as well as the quantity of education,

Correct AnswerverifiedShow Answer

The very high pay earned by the best actors and actresses is partially explained by the fact that

Correct AnswerverifiedShow Answer

A natural correction to employer discrimination in market economies is the

Correct AnswerverifiedShow Answer

One of the problems with calculating the true amount of discrimination that takes place in the market for labor is

Correct AnswerverifiedShow Answer

A plumber who specializes in cleaning plugged sewer lines is typically paid a higher wage than a plumber who works on installing water systems in new residential housing. Which of the following would push the wages of plumbers who work on sewer lines higher?

Correct AnswerverifiedShow Answer

Figure 19-5 -Refer to Figure 19-5. Suppose this market begins with demand for labor, D1, and supply of labor, S1, but the labor supply curve shifts to S2. Which of the following statements best describes the results?

Correct AnswerverifiedShow Answer

Figure 19-4 -Refer to Figure 19-4. If a union is successful in reducing supply from S1 to S2, the wage will

Correct AnswerverifiedShow Answer

Economists generally agree that

Correct AnswerverifiedShow Answer

Workers with more human capital on average earn substantially higher pay than workers with less human capital in

Correct AnswerverifiedShow Answer

Figure 19-5 -Refer to Figure 19-5. Given demand for labor, D1, and supply of labor, S2, what is the surplus of labor if a minimum wage of $8 per hour is imposed on this market?

Correct AnswerverifiedShow Answer

Among male workers over age 25, about what percent has a college degree? What is this percentage for black male workers over age 25?

Correct AnswerverifiedShow Answer

Is measuring the effect of discrimination on wages relatively easy or relatively difficult? Explain?

Correct AnswerverifiedIt can be relatively difficult...View AnswerShow Answer

Economists who attempt to explain the increasing earnings gap between skilled and unskilled workers offer two main hypotheses:

Correct AnswerverifiedShow Answer

The superstar phenomenon explains why professional athletes earn more than amateur athletes.

Correct AnswerverifiedShow Answer

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It can be relatively difficult...
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