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Economics Chapter 28 > Economics 28 > Flashcards

Economics 28 Flashcards

1
Q

Today a college graduate earns about $_____________ while a high school graduate earns about $__________

  • 74,000; 18,000
  • 51,000; 28,000
  • 51,000 ;18,000
  • 74,000: 28,000
A

51,000; 28,000

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2
Q

Which statement is true?

  • American manufacturing wages are the highest in the world
  • American manufacturing wage rates are the lowest of any industrial country
  • Our manufacturing wage rates are the second highest in the world
  • None of the statements are true
A

None of the statements are true

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3
Q
  • Which statement is false?
  • The subsitution effect means that you trade away leisure time for more money
  • The income effect means that you trade away some money for more leisure time
  • Both statements are true.
A

Both statements are true

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4
Q

In 1991 the base year you were earning $350.00 a week. Your wages rose to $450.00 in 2000 the current year, when the Consumer Price index stood at 135. What statement can you make about what happened to your real wages over this period.

  • They rose
  • They fell
  • They remained the same
  • There is not enough information to determine whether they rose, fell or remained the same
A

They fell

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5
Q

The backward-bending labor supply curve includes each of these variables except

  • the income effect
  • the substitution effect
  • the savings effect
A

the savings effect

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6
Q

A firm’s demand for labor is:

  • its MRP schedule
  • determined by the going wage rate
  • shaped mainly by the supply of labor
A

Its MRP schedule

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7
Q

If Jason were offered a job as an accountant at $30,000 and a job as a running back for the Oakland Raiders at $300,000 and he would have been willing to accept the latter even if it paid as little as $50,000 he would be receiving economic rent of

  • 30,000
  • 40,000
  • 250,000
  • 300,000
A

250,000

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8
Q

An effective minium wage is set

  • above the equilibrium level
  • below the equilibrium level
  • at the equilibrium level
A

above the equilibrium level

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9
Q

Which statement is true about incomes in the United States?

  • almost everyone earns about the same income
  • almost everyone is either very rich or very poor
  • There is a wide disparity of income
  • None of these statements is true
A

There is a wide disparity of income

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10
Q

Some conservative economists want to help more teenagers find jobs by

  • providing a government jobs program
  • raising the minimum wage rate for teenagers
  • requiring every business with more than 25 employees to hire at least one teenager for each three new employees hired.
A

lowering the minumum wage rate for teenagers

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11
Q

Which statement is true?

  • A firm’s marginal revenue product curve for labor is its demand curve
  • Most desirable jobs are in the primary labor market
  • Virtually no one today earns economic rent
  • None of these statements is false
A

Virtually no one today earns economic rent

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12
Q

The amount a person earns over and aboveo the amount she/he would be willing to work for is called:

  • marginal resource cost
  • economic rent
  • marginal revenue product
  • profit on human capital
A

economic rent

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13
Q

Suppose your economics professor earns an equal annual salary of $40,000. The professor loves teaching and would not quit her job if her pay were reduced to $15,000 per year. Your professor is earning annual economic rent of

  • 40,000
  • 25,000
  • 55,000
  • 15,000
A

25,000

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14
Q

According to the theory of the backward-bending labor supply curve, as the wage rate rises.

  • first the subsitution effect sets in, and then the income effect.
  • first the income effect sets in and then the subsitution effect
  • the substitution effect and the income effect set in at the same time
  • there is neither a subsitution effect nor an income effect
A

first the subsitution effect sets in, and then the income effect

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15
Q

The possibility of earninng economic rent is great if

  • the supply of a factor is very high relative to demand
  • the demand of a factor is very high relative to supply
  • both demand for a factor and suppy of a factor are high
  • both demand for a factor and supply of a factor are low.
A

the demand of a factor is very high relative to supply

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16
Q

If you are earning $20,000 a year today and you were to earn $40,000 a year in 10 years

  • your real wages and money wages will both have increased
  • your real wages and money wages will both have decreased
  • your real wages will have increased
  • your money wages will have increased
A

your money wages will have increased

17
Q

Which statement is true?

  • The highest paid professional athletes earn economic rent
  • Economic rent is paid on land but not in the form of wages
  • Economic rent is earned mainly by the poor and the lower middle class
  • Economic rent is paid in porportion to the marginal revenue product of a resource
  • None of the statements is true
A

The highest paid professional atheltes earn economic rent.

18
Q

Who is most likely to be earning economic rent?

  • A landlord
  • A postal employee
  • someone who lives in a rental apartment
  • A major league baseball player
A

A major league baseball player

19
Q

Conservative economists would like to help younger workers get work experience by

  • setting up a government jobs program
  • raising the minimum wage rate
  • lowering the minimum wage rate
  • passing a law requiring employers to hire teenagers ahead of older workers who are equally qualified.
A

lowering the minimum wage rate

20
Q

If the legal minimum wage rate were set a $15.00 hour

  • employment would decline substantially
  • employment would decline slightly
  • employment would not be affected
  • employment would rise slightly
  • employment would rise substantially
A

employment would decline substantially

21
Q

An increase in the demand for electricians will

  • increase economic rent earned by electricians
  • decrease the supply of electricians
  • decrease the economic rent earned by electricians
  • have no effect on economic rent earned by electricians
A

increase economic rent earned by electricians

22
Q

Compared to real wages in 1973 today they are about

  • 17% lower
  • 9% lower
  • the same
  • 9% higher
  • 17% higher
A

9% lower

23
Q

Among these countries, which as the highest hourly wage and fringe benefits from manufacturing?

  • Germany
  • Japan
  • The US
  • Canada
A

Germany

24
Q

Traditionaly our society got its dirty work done by

  • forcing oppressed minorities to do it
  • paying people higher wages to do it
  • All of the choices are correct
A

all the choices are correct

25
Q

Economic rent is generally associated with

  • high wages
  • low wages
  • both high and low wages
  • neither high nor low wages
A

high wages

Economics Chapter 28 (1 decks)

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