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tructural unemployment is sometimes said to result from a mismatch between the job skills that employers want and the job skills that workers have. To explore this idea, consider an economy with two industries: auto manufacturing and aircraft manufacturing.

1. If workers in these two industries require similar amounts of training, and if workers at the beginning of their careers could choose which industry to train for, what would you expect to happen to the wages in these two industries?

2. Suppose that one day the economy opens itself to international trade and, as a result, starts importing autos and exporting aircraft. What would happen to demand for labor in these two industries?

Demand for labor
Country begins importing autos
Country begins to export aircraft

3. Suppose that workers in one industry cannot be quickly retrained for the other. How would these shifts in demand affect equilibrium wages in the short run?

Wages in the auto industry
Wages in the aircraft industry

4. If for some reason wages fail to adjust to the new equilibrium levels, what would occur?

The labor market for auto workers
The labor market for aircraft workers

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14 Dec 2018

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Related questions

Consider an economy with two labor markets, one for manufacturing workers and one for service workers. Suppose that initially, none is unionized.
a) if manufacturing workers formed a union, what impact would it have on the wages and employment in manufacturing.
b. How would these changes in the manufacturing labor market affect labor supply in the market for service workers. What would happen to the equilibrium wage rate?
 

Consider an economy with two labor markets—one for manufacturing workers and one for service workers. Suppose initially that neither is unionized.

a. If manufacturing workers formed a union, what impact would you predict on the wages and employment in manufacturing?

b. How would these changes in the manufacturing labor market affect the supply of labor in the market for service workers? What would happen to the equilibrium wage and employment in this labor market?

home / study / business / economics / economics questions and answers / 1) workers in one country are more productive than workers in another country because -they ...

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Question: 1) Workers in one country are more productive than workers in another country because -they have ...

1) Workers in one country are more productive than workers in another country because

-they have more complementary factors to work with.

-they have fewer complementary factors to work with.

-they are better motivated and paid.

2) Conservative economists would like to help younger workers get work experience by

-setting up a government jobs program.

-raising the minimum wage rate.

-lowering the minimum wage rate.

-passing a law requiring employers to hire teenagers ahead of older workers who are equally qualified.

3) The Supreme Court's "rule of reason"

-has been applied since the time of the Civil War.

-has been applied since 1945.

-was applied from 1911 to 1945.

-has been applied since 1970.

4) Which is the smallest American labor union?

-United Auto Workers

-The International Brotherhood of Teamsters

-The National Education Association

-The Service Employees International Union

5) The Change to Win coalition recently mounted a national recruiting drive, primarily targeting _______.

-All of these jobs were targeted

-cashiers

-janitors

-dishwashers

6) The demand for labor is

-determined by the supply of labor.

-determined by the wage rate.

-its marginal revenue product schedule.

-higher at lower wage rates.

7) Economic rent is associated with

-low wages.

-agricultural workers.

-factory workers.

-high wages.

8) Which statement is true?

-The most important influence on a firm's demand for a factor of production is the demand for the final product.

-All of the statements are true.

-A firm will keep hiring more and more of a resource up to the point at which its MRP is equal to its price.

-If the MRP of the last worker hired is higher than the wage rate, the firm has hired too few workers.

9) Amelia Earhart's nominal wages rose from $40,000 to $50,000, while the CPI rose by 20%. Her real wages

-rose.

-fell.

-cannot be calculated with the available information.

-stayed the same.

10) Which of the following is NOT an example of a vertical merger?

-The merger of two computer companies

-The merger of an automobile company and a tire company

-The merger of a computer company and a microelectronics chip company

-The merger of a shoe producer and a leather producer

11) The demand for a resource rises as

-its productivity falls and prices of substitutable resources falls.

-its productivity rises and the prices of substitutable resources falls.

-its productivity rises and the relative prices of substitutable resources rises.

-its productivity falls and the relative prices of substitutable resources falls.

12) Interlocking directorates were expressly forbidden under the

-neither the Sherman Act nor the Clayton Act.

-both the Sherman and Clayton Acts.

-Clayton Act.

-Sherman Act.

13) A firm's demand for labor is

-its MRP schedule.

-determined by the going wage rate.

-shaped mainly by the supply of labor.

14) If unions are successful in negotiating a wage higher than the market equilibrium wage, and also guarantee employers that they can hire as many labor hours as they desire per week at the union wage,

-all workers who join the union will be guaranteed a job.

-the quantity of labor demanded will exceed the quantity supplied at the union wage.

-the quantity of labor demanded will equal the quantity supplied at the union wage.

-the quantity of labor demanded will fall short of the quantity supplied at the union wage.

15) Which of the following offers the best example of derived demand?

-An increase in the demand for cars causes an increase in the demand for gasoline.

-An increase in the demand for movie tickets causes an increase in the demand for popcorn.

-A decline in the demand for cars causes an increase in the demand for bus rides.

-An increase in demand for movie tickets causes an increase in the demand for movie theatre workers.

16) A "bill of rights" for union members and a provision of union election procedures were two of the main provisions of the _____ Act.

-Landrum-Griffin

-Sherman Antitrust

-National Labor Relations

-Taft-Hartley

17) The decision to bring suit in an antitrust case is usually made by

-the Supreme Court or a lower federal court.

-the injured party.

-the Department of Commerce.

-the Department of Justice.

18) At its peak labor union membership was about _____% of the labor force.

-35

-45

-15

-25

19) Combinations in restraint of trade are prohibited by

-the Sherman Act.

-the Federal Trade Commission Act.

-The Clayton Act.

20) Which statement is true?

-American manufacturing wages are the highest in the world.

-American manufacturing wage rates are the lowest of any industrial country.

-Our manufacturing wage rates are the second highest in the world.

-None of the statements are true. MICROECONOMIC

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