chapter 15

An increase in the minimum wage could

reduce employment but increase income.

A craft union attempts to increase wage rates by:

shifting the labor supply curve to the left.

a firm in a purely competitive labor market is a wage taker because

that firm alone cannot influence the market wage

The productivity and real wages of workers in industrially advanced economies have risen historically partly because:

workers have been able to use larger quantities of capital equipment.

Which of the following is an important factor influencing labor productivity in the United States?

High capital per worker

Which of the following tactics is most associated with the demand-enhancement union model?

Lobbying for increases in public expenditures on the product it is producing.

Bilateral monopoly occurs where:

a monopsonistic employer bargains with an inclusive union.

Marginal resource cost refers to the:

amount by which a firm's total resource cost increases as the result of hiring one more unit of the resource.

In a labor market characterized by bilateral monopoly, the wage rate will:

be logically indeterminate

The concept of human capital investment explains wage differentials because investment in human capital

enables a worker to build specialized skills that have additional wage value in the labor market.

Labor unions may attempt to raise wage rates by:

forcing employers, under the threat of a strike, to pay above-equilibrium wage rates.

Marginal revenue product (MRP) of labor refers to the:

increase in total revenue resulting from the hire of one more unit of labor.

Increases in the productivity of labor result partly from:

improvements in technology

Investment in human capital is any action that

improves a worker's skills and abilities

Inclusive unionism is practiced mostly by:

industrial unions.

The long-run rise in real-wage rates in the United States

is directly related to investments in human capital and improved labor force skills

The single most important factor underlying the long-run increase in average real-wage rates in the United States is

labor productivity

Hospital administrators sometimes complain about a "shortage" of nurses. The shortage is the result of

low wages that occur in the monopsonized market and could be eliminated if nurses earn wages closer to their MRP.

Other things equal, the monopsonistic employer will pay a:

lower wage rate and hire fewer workers than will a purely competitive employer.

The economic term for a firm that is the sole buyer in a market is:

monopsonist

If a firm decided to pay less than the going market wage rate,

no workers would offer their services to that firm

The general level of wages is higher in the United States and other industrially advanced countries because

of the high demand for labor in relation to supply

In monopsony:

the wage rate paid by the employer varies directly with the number of workers employed.