1. The predecessor to the AFL was the: (Points: 5)
Teamsters Union.
Knights of Labor.
CIO.
The International Workers of the World.
2. The __________ Act allows states to enact "right-to-work" laws. (Points: 5)
National Labor Relations
Taft-Hartley
Landrum-Griffin
Sherman Antitrust
3. An industrial union would be organized among a group such as: (Points: 5)
air traffic controllers.
plumbers.
airline pilots.
steel workers.
4. When a firm exercises monopsony power: (Points: 5)
the firm increases its profits at the expense of its workers.
workers gain but the firm loses.
workers, consumers, and owners of the firm are made better off.
both the firm and the workers gain.
5. Which statement is true with respect to the two basic ways that unions have of exerting power? (Points: 5)
Only inclusion leads to higher wages.
Only exclusion leads to higher wages.
Both inclusion and exclusion lead to higher wages.
Neither inclusion nor exclusion leads to higher wages.
6. A monopsony is: (Points: 5)
the seller of a product for which there are no close substitutes.
the buyer of a product for which there are no close substitutes.
both the seller and buyer of a product for which there are no close substitutes.
neither the seller nor buyer of a product for which there are no close substitutes.
7. Collective bargaining agreements in the United States generally: (Points: 5)
are negotiated for only a 1-year period.
are very detailed and specify wages levels and fringe benefits for a period of 2-3 years.
cover wages only.
are negotiated for only a 6-month period.
8. In 1991, the base year, you were earning $350/week. Your wages rose to $450 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? (Points: 5)
They rose.
They fell. (450/1.35 = 333.33)
They remained the same.
There is not enough information to determine whether they rose, fell, or remained the same.
9. The amount a person earns over and above the amount she/he would be willing to work for is called: (Points: 5)
marginal resource cost.
economic rent.
marginal revenue product.
profit on human capital.
10. 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: (Points: 5)
$40,000.
$25,000.
$55,000.
$15,000.
11. According to the theory of the backward-bending labor supply curve, as the wage rate rises: (Points: 5)
first the substitution effect sets in, and then the income effect.
first the income effect sets in, and then the substitution effect.
the substitution effect and the income effect set in at the same time.
there is neither a substitution effect nor an income effect.
12. Which statement is true? (Points: 5)
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 proportion to the marginal revenue product of a resource.
13. Conservative economists would like to help younger workers get work experience by: (Points: 5)
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.
14. Lorenz curves tell us about the: (Points: 5)
absolute distribution of income.
poverty line.
inverse relationship between price and the quantity demanded.
relative distribution of income.
15. Which goes exclusively to the poor? (Points: 5)
Medicaid
Medicare
Social Security
Unemployment insurance benefits
16. If the value of non-cash assistance to the poor were included in their income, the:
official number of persons classified as poor would be higher.
official number of persons classified as poor would be lower.
poverty income threshold would decrease.
poverty income threshold would increase.
17. During the decade of the 1980s our Lorenz curve: (Points: 5)
moved inward, toward the line of perfect equality.
moved outward, away from the line of perfect equality.
stayed about the same distance from the line of perfect equality.
crossed the line of perfect equality.
18. According to official statistics in the United States, a person is classified as poor: (Points: 5)
if the person's money income is below the poverty income threshold.
only if the person's money income is below the poverty income threshold AND the person is not working.
only if the person's money income is below the poverty income threshold AND the person is homeless.
if the person's money income and the value of non-cash transfers is below the poverty income threshold.
19. In which of the following groups of people in the U.S. would the incidence of poverty be the greatest? (Points: 5)
Black families with a female head
All families of seven or more members
Farmers and farm laborers
Families whose head is age 65 or over
20. Which of the following groups has the lowest median income in the United States? (Points: 5)
Married couples with both spouses working
Female-headed families with no husband present
Male-headed families with no wife present
Married couple families with the wife not working
