Labour Market MCQs

Option A: increasing the wage in the Unionized sector, Which may create a decrease in the supply of workers in the non-unionized sector

Option B: Increasing the demand for workers in the Unionized sector

Option C: decreasing the demand for workers in the Unionized sector

Option D: Increasing the wage in the Unionized sector which may create an increase in the supply of workers in the non-unionized sector

Correct Answer: Increasing the wage in the Unionized sector which may create an increase in the supply of workers in the non-unionized sector ✔

Option A: Raise the wage for insiders above the competitive equilibrium

Option B: Lower the wage of local outsiders

Option C: Offset the market power of a large firm that is the dominant employer in a region

Option D: Threaten a strike but don’t actually follow through so there are not lost hours of work

Correct Answer: Offset the market power of a large firm that is the dominant employer in a region ✔

Option A: At equilibrium wages workers sleep when the boss is not looking because workers are not deeply concerned about being fired

Option B: At equilibrium wages workers often quit to find better jobs.

Option C: At equilibrium wages only minimally qualified workers apply for the job

Option D: At equilibrium wages, workers cannot afford a healthy diet so they fall asleep at work due to a lack of energy

Correct Answer: All of these answers ✔

Option A: Establishing worker training Programs

Option B: Establishing right-to-work laws

Option C: Reducing unemployment benefits

Option D: Establishing employment agencies

Correct Answer: Raising the minimum wage ✔

Option A: The quantity of labour supplied will exceed the quantity of labour demanded and there will be Unemployment

Option B: Unions will likely Strike and the wage will fall to equilibrium

Option C: The quantity of labour demanded will exceed the quantity of labour supplied and there will be a labour shortage

Option D: The quality of workers in the applicant pool will tend to fall

Correct Answer: The quantity of labour supplied will exceed the quantity of labour demanded and there will be Unemployment ✔

Option A: Help all teenagers because they receive a higher wage than they would otherwise

Option B: have no impact on unemployment as long as it is set above the competitive equilibrium wage

Option C: Create more Unemployment is high-skill job markets than in low-skill job markets

Option D: Create more unemployment in low-skill job markets than in high-skill job markets

Correct Answer: Create more unemployment in low-skill job markets than in high-skill job markets ✔

Option A: 3.2 Percent

Option B: 5.7 Percent

Option C: 5.8 Percent

Option D: Not Enough

Correct Answer: 5.8 Percent ✔

Option A: Employed

Option B: Not in the labour force

Option C: A discouraged worker

Option D: Unemployed

Correct Answer: Not in the labour force ✔

Option A: Increase the budget surplus

Option B: Increase the balance of payment deficit

Option C: Reduce interest rates

Option D: Reduce government expenditure

Correct Answer: Reduce government expenditure ✔

Option A: Helps the economy move on the to Production Possibility Frontier

Option B: Helps shift the economy’s Production Possibility Frontier outwards

Option C: Helps the economy move along its Production Possibility Frontier

Option D: Helps the economy move inside the Production Possibility Frontier

Correct Answer: Helps the economy move on the to Production Possibility Frontier ✔

Option A: People lack information

Option B: People do not want to work

Option C: People do not have the right skills to work

Option D: People cannot afford to move location

Correct Answer: People do not have the right skills to work ✔

Option A: The quantity demanded of labour is higher than the quantity supplied

Option B: The quantity demanded of labour equals the quantity supplied

Option C: The quantity demanded of labour is lower than the quantity supplied

Option D: It will automatically adjust in the short run to bring equilibrium

Correct Answer: The quantity demanded of labour equals the quantity supplied ✔

Option A: Involuntary unemployment

Option B: Cyclical unemployment

Option C: Voluntary unemployment

Option D: A fall in aggregate demand

Correct Answer: A fall in aggregate demand ✔

Option A: There will be equilibrium in the labour market

Option B: There will excess demand in the labour market

Option C: There will be excess supply in the labour market

Option D: More people will be employed

Correct Answer: There will be equilibrium in the labour market ✔

Option A: The average cost of labour

Option B: The marginal product

Option C: The marginal revenue

Option D: The total cost of labour

Correct Answer: The total cost of labour ✔

Option A: Wages are a small proportion of total costs

Option B: Demand for the final product is price elastic

Option C: It is easy to replace labour

Option D: Capital is a good substitute for labour

Correct Answer: Wages are a small proportion of total costs ✔

Option A: A lower equilibrium wage and lower quantity of labour

Option B: A lower equilibrium wage and higher quantity of labour

Option C: A higher equilibrium wage and higher quantity of labour

Option D: A higher equilibrium wage and lower quantity of labour

Correct Answer: A higher equilibrium wage and lower quantity of labour ✔

Option A: Labour costs are a high percentage of total costs

Option B: Demand for the final product is price inelastic

Option C: It is relatively easy to substitute capital for labour

Option D: There are many substitutes for the final product

Correct Answer: There are many substitutes for the final product ✔

Option A: Frictional Unemployment would fall

Option B: The official unemployment rate would probably understate true unemployment

Option C: The official unemployment rate would probably overstate true unemployment

Option D: There would be no impact on the official unemployment rate

Correct Answer: The official unemployment rate would probably overstate true unemployment ✔

Option A: Unemployment due to unions

Option B: Unemployment due to efficiency wages

Option C: Frictional Unemployment

Option D: Unemployment due to minimum-wage laws

Correct Answer: Frictional Unemployment ✔

Option A: Paying above the competitive equilibrium wage tends to cause workers to shirk their responsibilities

Option B: Firms do not have a choice about whether they pay efficiency wages or not because these wages are determined by law

Option C: Paying the lowest possible wage is always the most efficient (Profitable)

Option D: Paying above the competitive equilibrium wage may improve worker health lower worker turnover improve worker quality and increase worker effort

Correct Answer: Paying above the competitive equilibrium wage may improve worker health lower worker turnover improve worker quality and increase worker effort ✔

Option A: of minimum wage laws

Option B: There are changes in the demand for labour among different firms.

Option C: Of unions

Option D: All of these answers

Correct Answer: There are changes in the demand for labour among different firms. ✔

Option A: Structural Unemployment

Option B: Unemployment due to efficiency wages

Option C: Unemployment due to unions

Option D: Frictional Unemployment

Correct Answer: Frictional Unemployment ✔

Option A: Maximum wage the firm is willing to pay

Option B: tip necessary to get a waiter to reserve a table

Option C: minimum wage the worker is willing to accept

Option D: competitive equilibrium wage.

Correct Answer: minimum wage the worker is willing to accept ✔

Option A: Structural unemployment

Option B: Cyclical Unemployment

Option C: Frictional Unemployment

Option D: None of these answers

Correct Answer: Structural unemployment ✔

Option A: Not in the labour force

Option B: Not in the adult population

Option C: Unemployed

Option D: Employed

Correct Answer: Not in the labour force ✔

Option A: 47.1 Percent

Option B: 65.9 Percent

Option C: 50.2 Percent

Option D: 70.2 Percent

Correct Answer: 70.2 Percent ✔

Option A: 134.0 million

Option B: None of theses answers

Option C: 92.3 million

Option D: 98.0 million

Correct Answer: 98.0 million ✔

Option A: The natural rate of unemployment

Option B: cyclical unemployment

Option C: efficiency wage unemployment

Option D: frictional unemployment

Correct Answer: The natural rate of unemployment ✔

Option A: The upward accelerator

Option B: The downward multiplier

Option C: The upward PPF

Option D: The downward mpc

Correct Answer: The downward multiplier ✔

Option A: Increased training

Option B: Providing more information

Option C: Helping individuals to move location to find work

Option D: Increasing spending on existing industries

Correct Answer: Helping individuals to move location to find work ✔

Option A: Increase interest rates

Option B: Encourage savings

Option C: Cut taxes

Option D: Reduce government spending

Correct Answer: Encourage savings ✔

Option A: unemployment benefits increase

Option B: Income tax increases

Option C: More training is available for the unemployed

Option D: Geographical immobility increases

Correct Answer: unemployment benefits increase ✔

Option A: Frictional unemployment

Option B: Seasonal unemployment

Option C: Cyclical unemployment

Option D: Structural unemployment

Correct Answer: Seasonal unemployment ✔

Option A: Occupational immobility

Option B: Cyclical unemployment

Option C: Structural immobility

Option D: Geographical immobility

Correct Answer: Cyclical unemployment ✔

Option A: Marginal revenue = marginal product

Option B: Marginal cost = marginal product

Option C: Marginal revenue product = average cost of labour

Option D: Marginal revenue product = marginal cost of labour

Correct Answer: Marginal cost = marginal product ✔

Option A: Upward sloping due to the law of demand

Option B: Upward sloping due to the law of marginal utility

Option C: Downward sloping due to the law of diminishing returns

Option D: Downward sloping due to the law of supply

Correct Answer: Upward sloping due to the law of demand ✔

Option A: A lower equilibrium wage and lower quantity of labour

Option B: A lower equilibrium wage and higher quantity of labour

Option C: A higher equilibrium wage and higher quantity of labour

Option D: A higher equilibrium wage and lower quantity of labour

Correct Answer: A lower equilibrium wage and higher quantity of labour ✔

Option A: Will usually lead to more people employed

Option B: Will decrease total earning if the demand for labour is wage elastic

Option C: is illegal in a free market

Option D: will cause a shift in the demand for labour

Correct Answer: will cause a shift in the demand for labour ✔