1. Under the welfare system described in the diagram below, the marginal wage fo
ID: 1164064 • Letter: 1
Question
1. Under the welfare system described in the diagram below, the marginal wage for this welfare recipient is:
A.
1/2 the market wage
B.
the market wage
C.
twice the market wage
D.
Zero
2. If leisure is a normal good, the income effect associated with an increase in the wage will cause the quantity of leisure consumed by a typical person to:
A.
increase.
B.
decrease.
C.
remain constant.
D.
change in a manner that cannot be predicted without additional information.
3. The optimal level of education occurs at the point at which:
A.
total costs = total benefits
B.
PV(total costs) = PV(total benefits)
C.
PV(marginal benefit) < PV(marginal cost)
D.
the marginal rate of return to education equals the discount rate.
4. he existence of non-pecuniary benefits from education might cause the conventionally measured rate of return to education to:
A.
understate the rate of return to education.
B.
overstate the rate of return for college graduates and understate it for high school graduates.
C.
appropriately measure the rate of return to education.
D.
overstate the rate of return to education.
5. Many studies measure inequality with the 90-10, 50-10, or 90-50 wage gaps rather than with the Gini coefficient. Why?
A.
The Gini coefficient is poorly defined.
B.
The Gini coefficient is ambiguous in terms of where in the earnings distribution inequality exists.
C.
The Gini coefficient tends to jump around from one year to the next due to extreme outliers.
D.
The Gini coefficient is a poor measure of international comparisons of inequality.
E.
The Gini coefficient fails to take into account the entire wage distribution.
6. How have average wages of college graduates compared to average wages of high school graduates over the last 30 years?
A.
Relative college wages have increased drastically over the last 30 years, from being 20 percent more than high school wages in 1980 to almost 60 percent more in 2010.
B.
Relative college wages have held steady over the last 30 years, with college graduates earning about 60 percent more than high school graduates during the entire period.
C.
Relative college wages have decreased slightly over the last 30 years, from being 40 percent more than high school wages in 1980 to just under 30 percent more in 2010.
D.
Relative college wages have held steady over the last 30 years, with college graduates earning about 90 percent more than high school graduates during the entire period.
E.
Relative college wages have increased drastically over the last 30 years, from being 50 percent more than high school wages in 1980 to almost 100 percent more in 2010.
7. Under the pure signaling model, the social benefit associated with education is:
A.
larger than the private benefit.
B.
equal to the private benefit.
C.
zero.
D.
None of the above is correct.
A.
1/2 the market wage
B.
the market wage
C.
twice the market wage
D.
Zero
Explanation / Answer
1) Ans============the statement A is correct
2)Ans============ Income will be increase A is correct
3)Ans ============ A is the correct options
4)Ans============Statement C is correct
5)Ans ============Statement C is the correct options.
6) Ans============ Options D is the correct options.
7)Ans============Options B is correct
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