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Commerce and BusinessbackBusinessbackPrinciples of EconomicsbackEconomicsbackPractice Set 2495back

Labour Markets And Income Inequality

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Question 1
Free
Multiple Choice

In a perfectly competitive labour market,all workers would earn the same wage if

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A

the world was fair.

B

workers' education and experience were identical.

C

all jobs had the same working conditions.

D

regional variables mattered.

E

jobs and workers were identical in every way.

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Question 2
Free
Multiple Choice

If labour markets were perfectly competitive,

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A

all workers would eventually earn the same wage.

B

all workers would achieve the same levels of education and experience.

C

working conditions would be the same for all jobs.

D

wage differentials could still exist because of differences in workers and jobs.

E

discrimination could not create wage differentials.

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Question 3
Free
Multiple Choice

One possible reason for wage differentials is that

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A

there are competitive forces operating in labour markets.

B

discrimination affects labour-market outcomes.

C

working conditions are the same for most jobs.

D

workers have more-or-less equal skills.

E

there is only a single national labour market.

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Question 4
Free
Multiple Choice

Other things being equal,individuals working in relatively risky working conditions generally

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A

earn higher wages due to the greater relative demand for these individuals.

B

earn higher wages due to the reduced supply of risk-taking individuals.

C

earn lower wages because of the scarcity of these jobs.

D

do not concern economists as these situations are uncommon.

E

work in perfectly competitive labour markets.

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Question 5
Free
Multiple Choice

All of the following are classified as human capital EXCEPT

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A

education.

B

training.

C

gender.

D

health.

E

experience.

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Question 6
Multiple Choice

One attempt to provide some minimum level of human capital for all citizens is a system of

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A
compulsory and publicly financed education.
B
income taxation.
C
unionism.
D
comparable worth.
E
minimum wages.
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Question 7
Multiple Choice

If you choose to stay in school beyond the compulsory minimum period,you are

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A
realizing the benefits of your investment in human capital.
B
delaying your investment in human capital.
C
refusing to invest in your human capital.
D
investing further in your human capital.
E
wasting your time from an economic standpoint.
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Question 8
Multiple Choice

During recessions,individual investment in higher education typically ________ due to the relatively ________ opportunity cost of time spent in university.

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A
rises; high
B
rises; low
C
falls; high
D
falls; low
E
stays constant; constant
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Question 9
Multiple Choice

Investment in human capital can be very costly to the individual,but it can also generate large returns.Canadian census data from 2007 show that average employment income for a university graduate is approximately ________ of the average employment income of a worker with no more than a high school diploma.

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A
50%
B
125%
C
200%
D
300%
E
400%
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Question 10
Multiple Choice

Wage differentials due to cross-worker differences in human capital

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A
are not justifiable on efficiency grounds.
B
will persist in competitive equilibrium.
C
are not an important source of observed wage differentials.
D
are an example of economic distortions due to monopoly power.
E
exist because of distortions in labour markets.
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Question 11
Multiple Choice

A typical firm hiring in a perfectly competitive labour market faces a marginal cost curve for labour that is

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A
horizontal.
B
vertical.
C
equal to the supply curve of the firm.
D
parallel to the firm's marginal cost curve for its product.
E
downward sloping.
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Question 12
Multiple Choice

In terms of human capital,which of the following is the best example of an inherited skill?

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A
a neurosurgeon who can perform brain surgery after many years of training
B
a retail worker who is able to work overtime each week
C
a worker who exercises is healthier and therefore more productive
D
a salesman doubles his sales after taking a training course
E
a music teacher who can carry a tune for the school choir
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Question 13
Multiple Choice

One or two generations ago,fewer Canadians completed post-secondary training and education.One explanation for this is

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A
a decrease in demand for more education in recent years.
B
wage differentials due to formal education have diminished over time.
C
a negative relationship between the acquisition of human capital and overall earnings.
D
the relative wage of more highly educated people has increased in recent years.
E
that the opportunity cost of post-secondary education has increased.
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Question 14
Multiple Choice

In recent years,some business schools in Canada have begun charging tuition of close to $35 000 per year for a graduate degree,whereas Arts faculties charge much lower tuition for their graduate degrees.Students are prepared to pay the high tuition in a business school because

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A
the expected payoff in terms of higher future wages is large.
B
the cost of providing the business education is far higher than the cost of the Arts education.
C
the marginal revenue product of a business degree is lower than the marginal revenue product of an Arts degree.
D
the marginal cost of a business degree is less than the marginal benefit of a business degree.
E
they recognize that the investment in human capital is not worthwhile.
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Question 15
Multiple Choice

The table below shows the labour demand and labour supply schedules in a competitive labour market.
image TABLE 14-1
-Refer to Table 14-1.In a competitive labour market that clears,the equilibrium employment level would be

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A
400 units.
B
500 units.
C
800 units.
D
1000 units.
E
1300 units.
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Question 16
Multiple Choice

The table below shows the labour demand and labour supply schedules in a competitive labour market.
image TABLE 14-1
-Refer to Table 14-1.If the wage rate is $15 per hour,how many hours per month are supplied to this market but are not actually employed?

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A
0
B
400
C
1000
D
1100
E
1500
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Question 17
Multiple Choice

The table below shows the labour demand and labour supply schedules in a competitive labour market.
image TABLE 14-1
-Refer to Table 14-1.In this labour market,if the wage rate is $10 per hour,how many hours of labour per month are actually employed?

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A
0
B
500
C
1000
D
1300
E
1850
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Question 18
Multiple Choice

Labour-market discrimination results in a

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A
lower supply in discriminating occupations and a higher supply in non-discriminating occupations.
B
higher supply in discriminating occupations and a lower supply in non-discriminating occupations.
C
lower supply in all occupations.
D
lower demand in all occupations.
E
higher demand in both occupations.
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Question 19
Multiple Choice

Labour-market discrimination,which keeps one group of workers out of elite (E)occupations and limits them to ordinary (O)occupations,will have which of the following effects?

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A
a decrease in supply and higher wages in the E occupations
B
more employment in the E occupations
C
a decrease in supply and lower wages in the O occupations
D
more unemployment in the E occupations
E
a decrease in supply and higher wages in the O occupation
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Question 20
Multiple Choice

Labour-market discrimination,which keeps one group of workers out of elite (E)occupations and limits them to ordinary (O)occupations,will have which of the following effects?

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A
a decrease in supply and lower wages in the O occupations
B
an increase in supply and lower wages in the E occupations
C
an increase in supply and higher wages in the E occupations
D
a decrease in supply and lower wages in the E occupations
E
an increase in supply and lower wages in the O occupations
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