Option A: has no impact on the human capital of workers?
Option B: increases human capital and the wages of workers
Option C: can make any worker into a superstar
Option D: only helps firms sort workers into high ability and low-ability workers.
Correct Answer: increases human capital and the wages of workers ✔
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Option A: can make any worker into a superstar
Option B: increases human capital and the wages of workers
Option C: only helps firms sort workers into high ability and low-ability workers
Option D: reduces the wage gap between high-skill and low-skill workers.
Correct Answer: only helps firms sort workers into high ability and low-ability workers ✔
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Option A: unpleasant
Option B: all these answers
Option C: safe
Option D: fun
Correct Answer: unpleasant ✔
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Option A: Attractive people tend to earn less because attractive people are viewed as shallow and more self-absorbed and therefore, as less productive
Option B: Attractive people tend to earn more because they may actually have a larger value of marginal product
Option C: Attractive people tend to earn more because attractive people usually have greater human capital
Option D: Attractive people tend to earn less because attractive people usually have less human capital
Correct Answer: Attractive people tend to earn more because they may actually have a larger value of marginal product ✔
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Option A: the best professor
Option B: the best writer
Option C: All of these answers participate in markets that could generate a superstar
Option D: The best accountant
Correct Answer: the best writer ✔
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Option A: It must be involved in professional athletics
Option B: Every customer must be indifferent to the price they pay, and the seller must be a competitor in the market for the product
Option C: Every customer must be willing to pay an enormous amount for the product and the product must be a necessity
Option D: Every customer must want the good supplied by the best producer and the technology must exist for the best producer to supply every customer at low cost
Correct Answer: Every customer must want the good supplied by the best producer and the technology must exist for the best producer to supply every customer at low cost ✔
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Option A: Increase labor market discrimination because some workers can charge more for their services than other workers in a competitive market
Option B: have no impact on labour market discrimination
Option C: reduce labour market discrimination because non-discrimination firms will employ cheaper labour earn more profits and drive discriminating firms out of the market
Option D: increase labour market discrimination because bigoted employers can charge any price they want in a competitive market to cover the cost of their discrimination
Correct Answer: reduce labour market discrimination because non-discrimination firms will employ cheaper labour earn more profits and drive discriminating firms out of the market ✔
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Option A: minimum-wage laws
Option B: efficiency wages
Option C: unions
Option D: beauty
Correct Answer: beauty ✔
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Option A: Men have more human capital than women
Option B: Employers in competitive markets are bigots
Option C: Men have more job experience than women
Option D: None of the above
Correct Answer: Employers in competitive markets are bigots ✔
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Option A: marginal revenue, marginal cost
Option B: long run marginal revenue, long run marginal cost
Option C: labor output ratio, capital output ratio
Option D: marginal cost of labor, marginal revenue product
Correct Answer: marginal cost of labor, marginal revenue product ✔
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Option A: footballers give more entertainment
Option B: lecturers are lazy
Option C: the labor markets are imperfect
Option D: top footballers are relatively scarce in relation to lecturers
Correct Answer: top footballers are relatively scarce in relation to lecturers ✔
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Option A: there are too few teachers
Option B: too few student places in higher education
Option C: it is costly to acquire human capital
Option D: teachers’ salaries are too low
Correct Answer: it is costly to acquire human capital ✔
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Option A: increase the wage, increase employment
Option B: maintain the wage, increase employment
Option C: increase the wage, lower employment
Option D: maintain the wage, lower employment
Correct Answer: increase the wage, lower employment ✔
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Option A: will not work at the offered wage
Option B: would work at the going wage but can’t find jobs
Option C: will not work because the hours are anti-social
Option D: Are not prepared to move house to get the job
Correct Answer: B. would work at the going wage but can’t find jobs ✔
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Option A: depreciation of the existing capital stock
Option B: productive investment
Option C: dwellings
Option D: inventories
Correct Answer: depreciation of the existing capital stock ✔
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Option A: its scrap values
Option B: its depreciation
Option C: the present value of the future stream of income it can earn
Option D: the cost of loans
Correct Answer: the present value of the future stream of income it can earn ✔
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Option A: encourage the use of more capital in the long run, reduce demand for all inputs
Option B: encourage the use of more capital increase demand for all inputs
Option C: encourage the use of less capital reduce demand for all inputs
Option D: encourage the use of less capital, reduce demand for all inputs
Correct Answer: encourage the use of less capital reduce demand for all inputs ✔
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Option A: wage differentials, skill levels
Option B: technology, the ease of factor substitution
Option C: government grants, international competition
Option D: patents, skill shortages
Correct Answer: technology, the ease of factor substitution ✔
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Option A: employees
Option B: the population
Option C: the factors of production
Option D: the working population
Correct Answer: the factors of production ✔
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Option A: housing gets priority
Option B: industry gets priority
Option C: farming gets priority
Option D: the equilibrium rental rate equilibrium total demand with supply
Correct Answer: the equilibrium rental rate equilibrium total demand with supply ✔
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Option A: variable, technology
Option B: fixed, expectations
Option C: fixed, rental rate of capital
Option D: variable, interest rates
Correct Answer: fixed, rental rate of capital ✔
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Option A: change in a company’s balance sheet when it acquires new plant
Option B: additional value of output from using more capital
Option C: change in company’s share price
Option D: changing value of the capital stock
Correct Answer: additional value of output from using more capital ✔
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Option A: wage rate of capital
Option B: interest charges
Option C: marginal capital cost
Option D: rental rate for capital
Correct Answer: rental rate for capital ✔
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Option A: low wages, employment
Option B: high wages, labor supply
Option C: high wages, productivity
Option D: high wages, employment
Correct Answer: high wages, productivity ✔
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Option A: they tend to work in relatively unskilled jobs
Option B: educational disadvantage
Option C: firms are reluctant to invest in training
Option D: all of the above
Correct Answer: all of the above ✔
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Option A: regional variation
Option B: unionization
Option C: relative danger
Option D: skills
Correct Answer: skills ✔
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Option A: inelastic the demand for labour, they can restrict the supply of labour
Option B: members they have, aggressive they behave
Option C: the economy is growing, people prefer leisure
Option D: the productivity is growing vacancies exist
Correct Answer: inelastic the demand for labour, they can restrict the supply of labour ✔
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Option A: course fees
Option B: course fees and living expenses
Option C: the earnings foregone
Option D: Course fees living expenses and textbook
Correct Answer: the earnings foregone ✔
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Option A: the tools used by workers to enhance productivity
Option B: a person inherited ability
Option C: the stock of expertise accumulated by a worker
Option D: education
Correct Answer: the stock of expertise accumulated by a worker ✔
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Option A: higher real wages
Option B: lower fixed costs of working
Option C: lower non-labour income
Option D: changes in tastes between leisure and work
Correct Answer: all of the above ✔
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A. Supply of labor
B. Short-run demand curve for labor
C. marginal cost of labour
marginal revenue product of labor
Correct Answer: Short-run demand curve for labor ✔
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Option A: increase; increase
Option B: increase; reduce
Option C: reduce; reduce
Option D: reduce; increase
Correct Answer: reduce; reduce ✔
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Option A: One employee is more attractive than another
Option B: One employee is more educated than another
Option C: All of these answers generated
Option D: One employee works harder than another
Correct Answer: One employee is willing to work the nightshift while another is not. ✔
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Option A: different preferences for the type of work they are willing to do
Option B: different levels of job experience
Option C: all of these answers are correct
Option D: different levels of education
Correct Answer: all of these answers are correct ✔
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Option A: The existence of a wage differential among groups is strong evidence of discrimination in the labour market
Option B: Discrimination can only persist in a competitive labour market it customers are willing to pay to maintain the discriminatory practice or the government requires discrimination
Option C: Bigoted employers are the main source of a persistent discriminatory wage differential in a competitive market
Option D: Discrimination cannot exist in a competitive labor market
Correct Answer: Discrimination can only persist in a competitive labour market it customers are willing to pay to maintain the discriminatory practice or the government requires discrimination ✔
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Option A: productivity
Option B: age
Option C: sex
Option D: race
Correct Answer: productivity ✔
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Option A: decrease in the demand for unskilled workers because of increases in technology and increases in international trade
Option B: increase in the number of unskilled workers available due to immigration into the UK.
Option C: decrease in the demand for unskilled workers are more poorly educated
Option D: increase in the number of unskilled workers available because workers are more poorly educated
Correct Answer: decrease in the demand for unskilled workers because of increases in technology and increases in international trade ✔
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Option A: women obtaining less human capital because they don’t plan to work continuously to the age of retirement
Option B: Women entering and leaving the labour force to care for children
Option C: customers preferring to deal with men
Option D: women preferring to work in pleasant clean safe work places
Correct Answer: all of these answers ✔
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Option A: All of these answers could be source of a persistent discriminatory wage differential
Option B: the customer
Option C: the government
Option D: the employer
Correct Answer: the employer ✔
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Option A: Working the night shift
Option B: working harder
Option C: more education
Option D: having a greater amount of natural ability
Correct Answer: doing a job that is fun ✔
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Option A: education
Option B: experience
Option C: all of these answers are parts of a worker’s human capital
Option D: effort
Correct Answer: effort ✔
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Option A: coal miners must have greater human capital than others
Option B: we have observed a compensating differential
Option C: coal miners must be more attractive than other workers
Option D: we have evidence of discrimination against workers outside the coal mine
Correct Answer: we have observed a compensating differential ✔
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