Public Policy and Labor Markets
Final Exam Questions
Course Introduction
This course examines the intersection of public policy and labor markets, focusing on how government interventions influence employment, wages, and working conditions. Students will explore key topics such as minimum wage laws, unemployment insurance, labor market regulations, collective bargaining, and workforce development programs. The course analyzes both theoretical frameworks and empirical evidence to assess the effectiveness of different policy approaches in promoting economic growth, reducing inequality, and addressing labor market challenges in various contexts. Through case studies and policy analysis, students will gain a comprehensive understanding of the complexities involved in designing and evaluating labor market policies.
Recommended Textbook
Labor Economics 7th Edition by George J Borjas
Available Study Resources on Quizplus
12 Chapters
360 Verified Questions
360 Flashcards
Source URL: https://quizplus.com/study-set/2387
Page 2
Chapter 1: Introduction to Labor Economics
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47424
Sample Questions
Q1) 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 these are labor economics concerns.
Answer: E
Q2) 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.
Answer: C
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Labor Supply
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47425
Sample Questions
Q1) What is the discouraged worker effect?
A)A discouraged worker will accept any job offer regardless of the wage.
B)Because a discouraged worker accepts a part-time job when he wants a full-time job, he is considered to still be unemployed.
C)A discouraged worker accepts a part-time job, and is therefore counted as being employed.
D)A discouraged worker stops looking for a job, but is still counted as being in the labor force.
E)A discouraged worker stops looking for a job, and therefore is no longer counted as being in the labor force.
Answer: E
Q2) According to the income effect, an increase in the wage rate will lead the worker to
A)work more hours if leisure is a normal good.
B)work fewer hours if leisure is a normal good.
C)work fewer hours if leisure is an inferior good.
D)work more hours and leisure more hours.
E)not change hours worked.
Answer: B
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Labor Demand
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47426
Sample Questions
Q1) Labor demand is more elastic the greater the elasticity of demand for the firm's output because
A)the firm would see its quantity demanded fall substantially if the firm tried to pass increased labor costs through to the consumer by increasing the price of the output good.
B)the firm's output price falls when the firm produces less output.
C)a firm that operates in a competitive output market cannot lower its price.
D)capital is usually price elastic.
E)the firm will want to hire fewer workers when the wage rate increases.
Answer: A
Q2) Labor demand is more elastic the greater the elasticity of substitution between labor and capital because
A)workers supply more labor when their wage increases.
B)the firm's output price falls when the firm produces more output.
C)a firm is less willing to pay higher labor costs if it is easy for the firm to substitute capital for labor.
D)firms always have the option of substituting capital for labor.
E)a firm's technology is slow to change.
Answer: C
To view all questions and flashcards with answers, click on the resource link above.
Page 5
Chapter 4: Labor Market Equilibrium
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47427
Sample Questions
Q1) If unskilled domestic labor and unskilled immigrant labor are substitutes in the production process, then a more open immigration policy will likely result in all but which of the following?
A)The total market supply of unskilled labor shifts out.
B)The market-clearing wage for unskilled labor decreases.
C)Total employment of unskilled labor increases.
D)The wage received by unskilled native workers decreases.
E)The demand curve for unskilled labor shifts up (out).
Q2) Which of the following does not characterize a perfectly discriminating monopsonist?
A)The firm's marginal cost of hiring curve is the labor supply curve.
B)The firm hires more workers than it would if it were a competitive firm.
C)The firm chooses employment and wage levels in order to maximize profit.
D)The firm pays each worker his or her reservation wage.
E)The labor supply curve can be upward sloping.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Compensating Wage Differentials
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47428
Sample Questions
Q1) The value of life is calculated by comparing
A)wages to risk levels.
B)risk levels to the number of children in a worker's household.
C)wages to the number of children in a worker's household.
D)average life expectancy by occupation to average risk levels by industry.
E)average wages to the average retirement age.
Q2) If the U.S. system of unemployment insurance didn't exist, one would predict that
A)workers would never become unemployed.
B)workers who became unemployed would remain unemployed for longer durations.
C)no worker would accept a job that is associated with seasonal unemployment.
D)seasonal unemployment would cease to exist.
E)workers in jobs that have high risks of unemployment or in jobs that face seasonal cycles of unemployment would be paid higher wages.
Q3) A potential implication of OSHA regulation is that
A)the most risk averse workers begin working the riskiest jobs.
B)the hedonic wage function may no longer exist at the safest levels.
C)the hedonic wage function may no longer exist at the riskiest levels.
D)average wages increase.
E)for the same amount of output produced, total production costs will be less.
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 6: Human Capital
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47429
Sample Questions
Q1) Labor force participation rates tend to
A)increase with education level for both men and women.
B)decrease with education level for both men and women.
C)decrease with education level for men but increase with education level for women.
D)be unrelated to education level for both men and women.
E)be unrelated to education level for men but increase with education level for women.
Q2) The data suggest that wages increase more with age for the highly educated compared to the less educated. This is evidence that
A)the return to education is low for all education levels.
B)the return to education is constant with respect to age.
C)on-the-job training is unrelated to the level of formal schooling.
D)less-educated workers invest in on-the-job training more so than do the highly educated.
E)highly educated people also invest more in post-schooling human capital compared to the less educated.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: The Wage Structure
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47430
Sample Questions
Q1) The Gini coefficient in a perfectly unequal society will have a Gini coefficient of _____ while a perfectly equal society will have a Gini coefficient equal to _____.
A)0; 1
B)1; 0
C)0; infinity
D)infinity; 0
E)-1; 1
Q2) The earnings distribution refers to the distribution of A)wages or earnings in an economy.
B)earnings over an individual's life.
C)wages between races.
D)wages between genders.
E)wage offers throughout an economy.
Q3) What does the Gini coefficient measure?
A)The rate of growth of income inequality over time.
B)The degree of inequality in an income distribution.
C)The correlation coefficient between income and education.
D)The covariance of income and education.
E)The degree of tax incidence paid by poor workers.
To view all questions and flashcards with answers, click on the resource link above.
Page 9
Chapter 8: Labor Mobility
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47431
Sample Questions
Q1) What is a likely explanation as to why workers who have been on the job for a long time earn more than newly hired workers?
A)Because workers in bad job matches tend to stay on the job longer.
B)Because workers in long-lasting job matches accumulate specific training over time, which increases the workers' productivity.
C)Because the positive effects of general training on education erode over time.
D)Young workers are more productive than older workers.
E)U.S. law requires older workers to be paid more than younger workers.
Q2) Roughly how many people immigrated legally to the United States in 2011?
A)250,000
B)750,000
C)1 million
D)2 million
E)3 million
To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: Labor Market Discrimination
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47432
Sample Questions
Q1) One possible measure of gender discrimination is to look at the difference between the average male wage and the average female wage. This is a poor measure of discrimination for all of the following reasons except:
A)Men and women might have different preferences when it comes to supplying labor.
B)Men and women may differ in the return they receive for their skills.
C)Men and women may differ in their overall level of skill.
D)Men and women may differ in their taste for part-time jobs.
E)Men and women may differ in their willingness to accept risky jobs.
Q2) A large employer gives each new hire an aptitude test, which is scored from 1 to 20. Let T be a worker's score on the test. The firm then pays the new worker a wage of w = 0.6T + 0.4G where G is the average test score for the worker's gender-16 for women; 12 for men. How much more is a woman paid than a man when both scored a 10 on the test?
A)$0.20
B)$0.40
C)$0.80
D)$1.60
E)$3.20
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Labor Unions
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47433
Sample Questions
Q1) The wage-employment outcomes described by the contract curve
A)fail to exhaust all bargaining opportunities between the employer and the union, except for the single point on the contract curve that is associated with maximum wages.
B)are associated with the firm hiring more workers at a higher wage than they would under a monopoly union outcome.
C)are Pareto optimal and result in an efficient contract.
D)must be located below and to the left of the outcome that would result in the absence of a union.
E)must be located above and to the left of the outcome that results when there is a monopoly union.
Q2) The labor demand curve is
A)the same as the marginal cost curve.
B)composed of the peaks of isoprofit curves.
C)upward sloping.
D)derived solely from the price of the firm's good.
E)determined completely by the firm's technology.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Incentive Pay
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47434
Sample Questions
Q1) The optimal efficiency wage requires
A)firms to pay the competitive wage.
B)firms to pay any wage above the competitive wage.
C)firms to pay the unique wage above the competitive wage such that the elasticity of output with respect to wages equals one.
D)firms to pay fringe benefits.
E)the total product curve to be downward sloping.
Q2) What happens to the piece rate if there is a ratchet effect?
A)The piece rate decreases over time.
B)The piece rate increases over time.
C)The piece rate is replaced with a time rate.
D)The piece rate is replaced with a salary contract.
E)The piece rate is only paid to the least productive workers.
Q3) One disadvantage of using a tournament is that
A)no one will apply for tournament-style jobs.
B)tournaments are more expensive than time rates or piece rates.
C)workers who view themselves as losing the tournament will quit providing effort.
D)the winners of tournaments are typically over-paid.
E)tournaments are not able to identify the most productive workers.
To view all questions and flashcards with answers, click on the resource link above.
Page 13
Chapter 12: Unemployment
Available Study Resources on Quizplus for this Chatper
30 Verified Questions
30 Flashcards
Source URL: https://quizplus.com/quiz/47435
Sample Questions
Q1) In 2012, the likelihood of experiencing a spell of unemployment lasting at least 12 months
A)was roughly the same in the United States as it was in Europe.
B)was much lower in the United States than in Europe.
C)was much higher in Europe than in the United States with all European countries having at least 30 percent of their unemployed experiencing a spell of unemployment of at least 12 months.
D)varied substantially across European countries, with some rivaling the United States but many others being much higher than in the United States.
E)varied substantially across European countries, with some rivaling the United States but many others being much lower than in the United States.
Q2) In the United States, the average replacement ratio associated with unemployment insurance benefits is
A)10%
B)35%
C)50%
D)80%
E)100%
To view all questions and flashcards with answers, click on the resource link above. Page 14