Question 1

Suppose labor supply can be described as E_S = 0.1w - 1,000 where w is yearly salary.How many more workers are willing to work at a yearly salary of $40,000 than at a yearly salary of $35,000? A)50 B)100 C)500 D)1,000 E)5,000

Accepted Answer

C

Question 2

The labor demand curve shows how many workers the firm is willing to hire
A)at any particular time.
B)at a particular amount of labor supplied.
C)at any given wage.
D)into high-skill jobs.
E)when demand for the firm's output is low.

Accepted Answer

The labor demand curve shows how many workers the firm is willing to hire at any given wage. The other choices are either incorrect or unrelated to the question.

Question 3

Suppose labor supply can be described as E_S = 0.1w - 1,000 where w is yearly salary.How many workers are willing to work when the yearly salary is $20,000? A)100 B)200 C)500 D)1,000 E)2,000

Accepted Answer

D

Question 4

A firm's demand for labor is derived in part from
A)government policy.
B)consumer demand for the firm's product.
C)unionized workers.
D)the firm's sunk costs.
E)the value of the firm's stock price.

Accepted Answer

A firm's demand for labor is derived from consumer demand for the firm's product, as the amount of labor needed is dependent on how much product the firm needs to produce to meet consumer demand. The other options, such as government policy, unionized workers, sunk costs, and stock price, may indirectly affect a firm's demand for labor, but they are not directly related to it.

Question 5

Which is not a decision made by potential workers in the United States?
A)Deciding whether or not to participate in the labor force.
B)Determining how to divide one's time between work and leisure.
C)Choosing how much to produce to maximize firm profit.
D)Choosing how much education to receive.
E)Deciding which occupation to pursue.

Accepted Answer

The amount of production to maximize firm profit is not a decision made by potential workers in the United States, but rather a decision made by the firm's owners or managers. The other choices involve decisions that potential workers make regarding their participation in the labor force, their allocation of time between work and leisure, their level of education, and their choice of occupation.

Question 6

An outward shift in the labor demand curve implies that.
A)employers are now looking to hire more workers at any given wage.
B)employers are now looking to hire more workers if the wage increases.
C)employers are now looking to hire fewer workers regardless of the wage.
D)demand for the firm's output likely fell.
E)a greater number of workers are now more willing to work at any given wage.

Accepted Answer

An outward shift in the labor demand curve means that employers are now willing to hire more workers at any given wage, indicating an increase in demand for labor.

Question 7

Which of the following is a positive (rather than a normative) question?
A)What effect does increasing welfare assistance by 20% have on female labor supply?
B)Should the U.S.allow unlimited immigration?
C)Should the "Highly Qualified Teacher" provision of No Child Left Behind be eliminated?
D)Should there be a minimum wage?
E)Should trade unions be allowed to lobby Congress?

Accepted Answer

This question is asking for the factual relationship between two variables (increasing welfare assistance and female labor supply) instead of prescribing what should be done.

Question 8

Suppose labor supply can be described as E_S = 0.1w - 1,000 where w is yearly salary.What yearly salary must be paid to encourage 6,000 workers to accept jobs? A)$30,000 B)$40,000 C)$50,000 D)$60,000 E)$70,000

Accepted Answer

The answer of Suppose labor supply can be described as...

Question 9

In part labor economics concerns:
A)How labor markets work.
B)The study of education decisions.
C)The study of how households decide where to live.
D)The study of income inequality.
E)All of the above.

Accepted Answer

Labor economics encompasses the study of labor markets, education decisions, household location choices, and income inequality.

Question 10

The labor supply curve shows how many workers are willing to work
A)in a particular industry.
B)at any given time.
C)at the minimum wage.
D)at any given wage.
E)in order to maximize the firm's profit.

Accepted Answer

The labor supply curve shows the number of workers willing to work at any given wage. It illustrates the relationship between the wage rate and the quantity of labor supplied by individuals. The curve slopes upwards, indicating that as the wage rate increases, the quantity of labor supplied also increases.

Question 11

Which of the following is not a leading actor in labor markets?
A)Consumers
B)Firms
C)Workers
D)Government
E)Unions

Accepted Answer

Consumers are not a leading actor in labor markets as they do not directly affect the wages, employment opportunities, or working conditions of workers. They may indirectly influence labor markets by affecting the demand for goods and services and thus the demand for labor, but they are not considered a leading actor. Firms, workers, government, and unions are all leading actors in labor markets as they have a direct impact on wages, employment opportunities, and working conditions.

Question 12

The government is a player in the U.S.labor market in part because the government
A)determines who can go to college.
B)assigns potential workers to particular industries.
C)sets workplace worker safety regulations.
D)suggests a minimum wage for firms to pay.
E)funds employer-based health insurance benefits.

Accepted Answer

The answer of The government is a player in the...

Question 13

When forming theories, economists must be careful to
A)include all known facts and details.
B)omit crucial factors.
C)mirror the real world as realistically but as simply as possible.
D)consider historical behavior and policies.
E)limit the analysis to two variables.

Accepted Answer

The answer of When forming theories, economists must be careful...

Question 14

What type of questions cannot be answered with theory or facts alone?
A)Normative questions.
B)Positive questions.
C)Factual questions.
D)Empirical questions.
E)Econometric questions.

Accepted Answer

Normative questions are questions that involve value judgments and cannot be answered with theory or facts alone, as they require subjective opinions and personal beliefs.

Question 15

What is the difference between normative and positive economics?
A)Normative economics concerns the how and why of economic activity while positive economics concerns what should be.
B)Positive economics concerns what is, while normative economics concerns what should be.
C)Both concern the how and why of economic activity, while only positive economics also concerns what should be.
D)Neither deals with the how and why of economic activity, but normative economics concerns what should be.
E)Positive economics is used in Microeconomics, while normative economics is used in Macroeconomics.

Accepted Answer

Positive economics deals with the objective facts and cause and effect relationships of economic activity, while normative economics deals with opinions, values and judgments about what economic activity ought to be.

Question 16

Which of the following is a normative (rather than a positive) statement?
A)The (nominal) minimum wage is $7.25 per hour.
B)Public education should be funded primarily at the state level.
C)The federal debt exceeds $8 trillion.
D)At its peak, unemployment exceeded 10% during the 2007 recession.
E)The average wage of high-school dropouts has fallen by 20% since 1970.

Accepted Answer

A normative statement is one that expresses value judgments, opinions, or recommendations. Option B is a normative statement as it expresses a recommendation about how public education should be funded. The other options are positive statements that reflect actual facts or data.

Question 17

An upward-sloping labor supply curve implies that
A)a firm can always hire more workers, even without increasing the wage.
B)more workers are willing to work when wages are low.
C)more workers are willing to work as the market wage increases.
D)labor supplied is fixed.
E)there is a continuously increasing demand for labor.

Accepted Answer

An upward-sloping labor supply curve implies that as the market wage increases, more workers are willing to work, indicating a positive relationship between the wage and the quantity of labor supplied. Thus, choice C is the correct answer. The other choices are incorrect as they either do not reflect the relationship between the wage and the quantity of labor supplied or are inconsistent with the concept of a labor supply curve.

Question 18

A firm's labor demand curve is typically
A)a vertical line.
B)a horizontal line.
C)upward-sloping.
D)downward-sloping.
E)associated with a slope equal in absolute value to the slope of the labor supply curve.

Accepted Answer

The labor demand curve is downward-sloping because as wages increase, firms will reduce their quantity of labor demanded due to the higher cost of production.

Question 19

What type of questions can be answered with economic tools without interjecting any value judgment as to whether the particular outcome is desirable or harmful?
A)Normative questions.
B)Positive questions.
C)Labor questions.
D)Econometric questions.
E)Public policy questions.

Accepted Answer

Positive questions can be answered with economic tools without any value judgment. Positive questions seek to evaluate the cause-and-effect relationship between economic variables without evaluating whether the outcome is desirable or not.

Question 20

The typical labor supply curve
A)is u-shaped.
B)equals the marginal product of labor.
C)slopes up.
D)slopes down.
E)depends on the size of the firm.

Accepted Answer

The typical labor supply curve slopes upward, indicating that as wages increase, workers are willing to supply more labor.

Quiz 1: Introduction to Labor Economics

Suppose labor supply can be described as ES = 0.1w - 1,000 where w is yearly salary.How many more workers are willing to work at a yearly salary of $40,000 than at a yearly salary of $35,000?

The labor demand curve shows how many workers the firm is willing to hire

Suppose labor supply can be described as ES = 0.1w - 1,000 where w is yearly salary.How many workers are willing to work when the yearly salary is $20,000?

A firm's demand for labor is derived in part from

Which is not a decision made by potential workers in the United States?

An outward shift in the labor demand curve implies that.

Which of the following is a positive (rather than a normative) question?

Suppose labor supply can be described as ES = 0.1w - 1,000 where w is yearly salary.What yearly salary must be paid to encourage 6,000 workers to accept jobs?

In part labor economics concerns:

The labor supply curve shows how many workers are willing to work

Which of the following is not a leading actor in labor markets?

The government is a player in the U.S.labor market in part because the government

When forming theories, economists must be careful to

What type of questions cannot be answered with theory or facts alone?

What is the difference between normative and positive economics?

Which of the following is a normative (rather than a positive) statement?

An upward-sloping labor supply curve implies that

A firm's labor demand curve is typically

What type of questions can be answered with economic tools without interjecting any value judgment as to whether the particular outcome is desirable or harmful?

The typical labor supply curve

Suppose labor supply can be described as E_S = 0.1w - 1,000 where w is yearly salary.How many more workers are willing to work at a yearly salary of $40,000 than at a yearly salary of $35,000?

Suppose labor supply can be described as E_S = 0.1w - 1,000 where w is yearly salary.How many workers are willing to work when the yearly salary is $20,000?

Suppose labor supply can be described as E_S = 0.1w - 1,000 where w is yearly salary.What yearly salary must be paid to encourage 6,000 workers to accept jobs?