question

The equilibrium model of migration predicts that

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worker flows tend to equalize the overall value of the job package offered in each region.

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Immigration and outsourcing both reflect

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competition among workers.

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An increase in his or her expected career length will make a worker

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more likely to change jobs.

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The earnings of immigrants, when compared to those of similar native workers, start out

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below those of the native workers, but increase more rapidly

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For workers who emigrate to the United States from a country with a less equal distribution of earnings,

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the largest potential gain exists for unskilled workers

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When considering competition in the labor market due to immigrating workers, the substitution effect

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describes a situation where the immigrating workers are direct substitutes for domestic workers.

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If skilled and unskilled labor are gross substitutes and if an influx of unskilled immigrants drives down the wages paid to unskilled workers, it will also

answer

decrease the wage of skilled workers

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Which of the following would decrease the mobility of workers within a nation?

answer

an increase in the percent of jobs that are unionized, laws requiring a mandatory waiting period before persons moving into a community qualify for welfare benefits, and laws making it more costly for employers to fire workers

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Those who are willing to immigrate over a long distance and at a high cost are more likely to

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have low discount rates.

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The costs associated with moving do NOT include

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the risk-return trade-off.

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In an industry, a unit of output can be produced by 3 unskilled workers or by 1 skilled worker. From this information, skilled and unskilled workers are

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substitutes-in-production.

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Assuming the demand curve for labor does not shift, a given inflow of immigrants will lower wages more when

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Neither the labor demand curve being more elastic nor the domestic labor supply curve being more elastic will cause the wage to fall more.

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Which of the following is NOT an explanation for return and repeat migration?

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Family members in a family decision model of migration prefer being in the same location.

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An increase in the number of immigrants causes

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the labor supply curve to shift to the right.

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When considering competition in the labor market due to immigrating workers, the scale effect

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describes a situation where the immigrating workers are complements to domestic workers and lead to increased specialization.

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Under competitive conditions, immigration does NOT tend to

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lower the wages of immigrant workers.

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An individual is more likely to migrate, ceteris paribus,

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the lesser the length of the training time.

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Increased border control on the US-Mexico border directly affects

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the cost of migration

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The returns to immigration are generally larger for people

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who have greater educational attainment

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A firm could profitably pay for a worker's general training if

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the training program would also serve as a screening device

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Which of the following will not destroy at least part of the returns to the firm's investment in specific human capital?

answer

off-the-job training

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Which of the following is not an example of an industry-specific skill?

answer

literacy

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If a firm offers specific training to its workers, when the training is over,

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workers will most likely be paid a wage that is less than their marginal product.

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Initially, when a firm hires a fourth worker, its wage rate goes from $80 a worker to $90. The marginal revenue product of the fourth worker is $100. Then the government imposes a minimum wage of $90 a worker. If the firm now hires the fourth worker, its profits

answer

will increase by $10.

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The marginal product of a new worker is 80 units and the marginal expense of a new worker is $80. The marginal product of hiring current workers another hour is 10 units and the marginal expense of hiring current workers another hour is $12. If the firm needs extra hours of work (assuming the work could be done by either the new or current workers), it should

answer

hire new workers

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Which of the following is definitely NOT a quasi-fixed cost of labor?

answer

overtime pay

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Suppose that mobility costs incurred by workers are low. In this circumstance, the best way to provide incentives for on-the-job training is for

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employers and employees to share the costs of the investment

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Compared with general training, specific training will lead to a life-cycle earnings pattern that is

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flatter.

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Employment protection policies adopted in many European countries tend to

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reduce layoffs and reduce job creation

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Use of temporary-help agencies

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requires employers to pay more per hour than if they hired the worker directly.

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Two employers, A and B, pay the same wage but Employer A faces a more inelastic supply curve of labor than Employer B. Both firms are monopsonies but have similar outputs and technologies. Other things being the same, then in the long run

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Employer A will employ more capital than Employer B.

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All else equal, a firm will prefer to hire a worker who will

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stay at the firm for a long period of time

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A firm employs 10 workers at a weekly wage of $500. If it employs an eleventh worker, it has to raise all of its workers wage to $520. The eleventh worker adds $750 a week to revenues. If the firm hires the eleventh worker, its weekly profits will

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go up by $30.

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Under the most basic assumptions of the human capital model, ____ are more willing to pay for general training and ____ more willing to pay for specific investments.

answer

workers, firms

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The evidence suggests that on-the-job training increases with all but which of the following?

answer

layoffs

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An increase in quasi-fixed costs would probably lead to a(n) ________ in the number of employees hired and a(n) ________ in the number of overtime hours worked.

answer

decrease; increase

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Suppose the wages of both high school and college graduates decrease by $2,000 per year. In response to the opportunity cost, the number of people attending college will consequently ________.

answer

increase

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Which of the following is a cost of going to college?

answer

not the cost of living in a dorm and not the cost of college cafeteria food

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Which of the following is NOT an investment in human capital?

answer

buying stock in a company that publishes textbooks

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Present-oriented people discount future earnings ________ forward-looking people.

answer

at a higher rate than

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Increased grants and loans for college expenses would ________ the number of college graduates, while ________ wages paid to college graduates.

answer

increase; decreasing

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Which of the following will increase the value of attaining an education in the human capital framework?

answer

increased expected working lifespan

question

Workers with relatively high levels of natural ability are quite likely to attend college. This can cause ________ bias when estimating educational returns because ________.

answer

an upward; ability increases earnings

question

Fewer women leaving the labor market to raise children has yielded age-earnings profiles which are ________ than they were about twenty years ago.

answer

no different

question

The psychic costs of college are usually lowest for

answer

students with relatively high ability.

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If both the demand for and the supply of college graduates shift to the left, then the equilibrium wage would ________ and the number of college graduates would ________.

answer

change ambiguously; decrease

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John is trying to decide whether to go to college or to start working right out of high school. College as an investment is most likely justified when ________ is greater than the cost of going to college.

answer

the present value of the difference between what John would earn as a college graduate and what he would earn as a high school graduate

question

Firms use signals to estimate productivity so that they can

answer

save on the costs of more accurate estimates.

question

Women generally receive ________ on-the-job training than men, causing their age-earnings profiles to be ________ than those of men.

answer

less; flatter

question

Human capital is:

answer

any investment in a worker's skills.

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Students who attend college because they enjoy the lifestyle and freedom are treating college

answer

as a consumption good.

question

Which of the following would likely, in the long run, reduce the observed rate of return from going to college?

answer

Educational reforms cause going to college to be fun and enjoyable.

Labor Economics ECON 315 Lesson 7, 8, and 9 Concept Quizzes – Flashcards

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