Question

Question 14 pts

Getting the work done by some other firm at lower costs, when the firm is situated in some other country, is called outsourcing.

True

False

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Question 24 pts

A compensating wage differential is a wage difference attributable to the difference in the marginal productivity of workers.

True

False

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Question 34 pts

People tend to remain in those occupations that require continuous time and financial commitments to remain productive.

True

False

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Question 44 pts

A wage differential between skilled and unskilled workers exists because skilled workers have higher marginal products than unskilled workers.

True

False

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Question 54 pts

If employers have imperfect information about job applicants, it may be rational for them to use:

statistical discrimination.

consumer prejudice.

occupational segregation.

employer prejudice.

worker prejudice.

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Question 64 pts

The table below shows the distribution of income in the U.S. in the year 1978.
Table 19.1

Percent Distribution of Aggregate Household Income in 1978, by Fifths of Households
Households	Percent of Income
Lowest Fifth (under $6,391)	4.3
Second Fifth ($6,392 - $11,955)	10.3
Third Fifth ($11,956 - $18,122)	16.9
Fourth Fifth ($18,122 - $26,334)	24.7
Top Fifth ($26,335 and over)	43.9

According to Table 19.1, what percentage of income is received by the top 40% of the population?

56.2%

68.6%

41.6%

51.9%

60.8%

Answer 1

1.

True

In outsourcing, work is allocated to those, in other countries, where it can be done at lower cost.

2.

False

Compensating wage differential has to do with the degree of undesirability of the job and making individuals take up these undesired jobs.

3.

False

4.

True

Skilled workers are more productive than the non-skilled workers, so deserving relatively higher wages.

5.

A

6.

D

Income received = 24.7 + 43.9 = 68.6%