Question 1

Which of the following is,by definition,enforceable in a court of law?&#10;A) an implicit contract&#10;B) a relational contract&#10;C) the Peter principle&#10;D) an explicit contract&#10;E) a Pareto optimal contract

Accepted Answer

An explicit contract is a written or spoken agreement that is enforceable by law. It outlines specific terms, conditions, and obligations that both parties must adhere to, and can be used as evidence if either party fails to meet their obligations. Implicit contracts and relational contracts are based on mutual understandings or expectations, but may be difficult to enforce in court if there is no clear documentation of the agreement. The Peter Principle and Pareto optimal contract theories are not contracts and therefore not enforceable in court.

Question 2

e canonical view of an internal labor market is NOT characterized by which of these stylized properties?&#10;A) The organization has a distinct and stable hierarchy of jobs.&#10;B) Wages are attached to jobs rather than the workers who fill those jobs.&#10;C) The workers' actions are determined by a price and wage system.&#10;D) Workers have lengthy careers at the firm along a job ladder where promotions&#10;Are often the result of seniority rather than performance.&#10;E) The internal labor market is attached to the external labor market through ports&#10;Of entry and exit.

Accepted Answer

The canonical view of an internal labor market is characterized by a price and wage system, but not entirely determined by it. Other factors such as seniority, performance, and training also play a role. Therefore, choice C is incorrect.

Question 3

According to Doeringer and Piore (1971),the supplants the price and wage system of the as the primary means .&#10;A) internal labor market;external labor market;by which scarce resources are allocated&#10;B) internal labor market;external labor market;by which workers are recruited&#10;C) internal labor market;external labor market;by which the market is organized&#10;D) external labor market;internal labor market;by which scarce resources are allocated&#10;E) external labor market;internal labor market;by which workers are recruited

Accepted Answer

According to Doeringer and Piore (1971), the internal labor market supplants the price and wage system of the external labor market as the primary means by which scarce resources are allocated within a firm. This means that the internal labor market, with its own set of rules and regulations, becomes the main mechanism for allocating work, wages, and opportunities within the firm. The external labor market is still important for recruiting new workers into the firm, but the internal labor market takes priority in terms of allocating resources.

Question 4

In the working relationship of a boss,B,and a worker,W,which of the following is NOT necessarily true?&#10;A) W accepts authority when his behavior is determined by B's decisions.&#10;B) B has formal authority if he has the right to veto a proposal and implement his own plans.&#10;C) B has real authority if he has the right to fire W.&#10;D) W enters into an employment contract with B when W agrees to accept the authority of B and B agrees to pay W a stated wage.&#10;E) W can choose whether or not to accept an employment contract.

Accepted Answer

Real authority involves the ability to make decisions that affect the organization's actions, not just the power to hire or fire. The ability to fire an employee (W) does not solely define real authority for a boss (B); real authority encompasses broader decision-making powers within the organization.

Question 5

Which of the following is a reason the Peter principle's inefficient promotion practices might occur?&#10;A) asymmetric ignorance about workers' true abilities&#10;B) incentive problems&#10;C) hierarchical management structures&#10;D) tournament schemes&#10;E) efficiency wages

Accepted Answer

The answer of Which of the following is a reason...

Question 6

Ports of entry and exit are defined as:&#10;A) where the internal labor market comes in contact with the external labor market.&#10;B) where manufactured products enter and leave a firm.&#10;C) respectively,the wages workers take in and the output they produce.&#10;D) respectively,the output workers produce and the wages they take in.&#10;E) the methods by which inputs are received by a firm and output is delivered by a&#10;Firm.

Accepted Answer

Ports of entry and exit are typically used in the context of labor markets, where they refer to the points where workers enter or exit the market, such as when they move from one job to another or from outside the market into the labor force. Options B, C, D, and E do not accurately describe the concept of ports of entry and exit in labor markets.

Question 7

Which of the following is NOT a reason that a firm might make a reputational nvestment?&#10;A) in order to improve or retain its reputation among potential workers&#10;B) in order to reap immediate rewards&#10;C) in order to induce workers to make costly effort&#10;D) in order to reap future benefits&#10;E) in order to attract high-quality workers

Accepted Answer

Making a reputational investment is typically a long-term strategy, and reaping immediate rewards is not a common reason for doing so. The other options (A, C, D, and E) are all potential reasons a firm might make a reputational investment.

Question 8

The owner of an asset enjoys _______ ,which are the rights to all uses of an asset in a way not consistent with a prior contract.&#10;A) residual control rights&#10;B) formal authority&#10;C) real authority&#10;D) the buy decision&#10;E) the make-or-buy decision

Accepted Answer

Residual control rights refer to the owner's ability to exercise control over the use of an asset outside of any prior contractual agreements. This includes the ability to make decisions about the use, transfer, or disposal of the asset. Therefore, A is the correct choice. Option B, formal authority, refers to authority granted through a formal position or title within an organization. Option C, real authority, refers to the legitimate authority granted to an individual based on their role or position within an organization. Option D, the buy decision, refers to the decision to purchase goods or services from an external supplier rather than producing them internally. Option E, the make-or-buy decision, is similar to D in that it involves deciding whether to produce a good or service in-house or outsource it to an external supplier. However, neither D nor E relate directly to the rights of an asset owner.

Question 9

Which of the following is a reason that long-term jobs can only partially be explained by the accumulation of firm-specific human capital?&#10;A) Long-term jobs also require general human capital.&#10;B) Some workers' real earnings decline over time.&#10;C) Firm-specific human capital only partially explains the level of a worker's output.&#10;D) Workers only acquire firm-specific human capital for the first few weeks of a job.&#10;E) Only high-ability workers are able to acquire firm-specific human capital.

Accepted Answer

The answer of Which of the following is a reason...

Question 10

Which of the following is an example of the make-or-buy decision?&#10;A) A textbook maker decides whether to rent an office building or buy an office building.&#10;B) A shoe salesman decides whether to work at a department store or a local shoe store.&#10;C) A mother decides whether to babysit her own children or send her children to daycare.&#10;D) A scientist decides whether to hire a new research assistant or give the research assistant he already has employed more work.&#10;E) A teacher decides whether to teach first or second grade.

Accepted Answer

The make-or-buy decision involves choosing between producing a good or service in-house (making) or purchasing it from an external supplier (buying). Option C, where a mother decides whether to babysit her own children (make) or send her children to daycare (buy), is an example of this decision.

Question 11

Which of the following is NOT a true statement about relational contracts?&#10;A) A relational contract has unenforceable elements.&#10;B) A relational contract must be self-enforcing in order to be effective.&#10;C) In order to work,a relational contract must have long-term benefits of adhering to the contract that are greater than the short-term gains of breaking the contract.&#10;D) A relational contract is based on reputation.&#10;E) A relational contract includes only verifiable information.

Accepted Answer

The answer of Which of the following is NOT a...

Deck 16: Careers and the Employment Relation