#1
Which of the following is not a factor affecting labor supply?
Immigration policies
ExplanationImmigration policies are external to an individual's decision to supply labor and do not directly influence personal choices in the labor market.
#2
Which theory suggests that countries should specialize in producing goods for which they have the lowest opportunity cost?
Comparative advantage theory
ExplanationComparative advantage theory proposes that countries should specialize in producing goods where they have a lower opportunity cost, promoting efficient resource allocation.
#3
What is the primary purpose of a labor union?
To negotiate better working conditions and wages for its members
ExplanationThe primary purpose of a labor union is to advocate for and negotiate improved working conditions and wages on behalf of its members.
#4
What is the primary objective of trade unions?
To protect and advance the interests of workers
ExplanationTrade unions aim to safeguard and promote the welfare of workers by negotiating for better conditions, wages, and rights.
#5
Which of the following is NOT a measure of unemployment rate?
U4
ExplanationU4 is not a standard measure of unemployment rate; commonly used measures include U1, U2, U3, and U6.
#6
What is the concept that refers to the situation when an employee is willing to work at a wage rate higher than the equilibrium wage rate?
Efficiency wage
ExplanationEfficiency wage refers to the wage rate higher than equilibrium, where employees are more productive and motivated.
#7
In labor economics, what does the term 'reservation wage' refer to?
The wage at which an individual is indifferent between working and not working
ExplanationReservation wage is the wage at which individuals are indifferent between working and not working, influencing their job acceptance decisions.
#8
Which of the following is an example of a trade barrier?
Import quota
ExplanationAn import quota restricts the quantity of goods that can be imported, serving as a trade barrier and affecting international trade.
#9
Which of the following is NOT a characteristic of labor mobility?
Educational mobility
ExplanationEducational mobility is not a characteristic of labor mobility; actual mobility refers to the ease of workers moving between jobs or locations.
#10
Which of the following factors contributes to the phenomenon of brain drain?
Limited job opportunities in the home country
ExplanationLimited job opportunities in the home country drive skilled workers to seek employment abroad, contributing to the phenomenon of brain drain.
#11
Which of the following is NOT a method to measure international trade openness?
Unemployment rate
ExplanationThe unemployment rate is not a measure of international trade openness; common methods include trade-to-GDP ratio and trade balances.
#12
What is the main assumption underlying the theory of comparative advantage?
Fixed factor proportions
ExplanationThe theory of comparative advantage assumes fixed factor proportions, meaning factors of production cannot move between industries.
#13
Which of the following is NOT a reason why firms may choose to outsource labor to other countries?
Government subsidies for domestic labor
ExplanationGovernment subsidies for domestic labor are not a reason for firms to outsource; common reasons include cost savings and access to specialized skills.
#14
In international trade, what is meant by the term 'dumping'?
Exporting goods at a price below their production cost
ExplanationDumping refers to the practice of exporting goods at a price below their production cost, potentially distorting international trade.
#15
What does the 'Stolper-Samuelson theorem' propose regarding the impact of trade on factor prices?
Trade decreases wages and increases profits
ExplanationThe Stolper-Samuelson theorem suggests that trade can lead to a decrease in wages and an increase in profits for the factors of production used intensively in the production of exported goods.
#16
Which of the following is NOT a characteristic of a perfectly competitive labor market?
Price-setting power for individual firms
ExplanationA perfectly competitive labor market lacks individual firms' price-setting power, as wages are determined by market forces.