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Multiple Choice Quiz
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1

The source(s) of discrimination in Gary Becker's taste for discrimination model is (are)
A)the employer.
B)the employee.
C)the customer.
D)all of the above.
E)none of the above.
2

In Gary Becker's model of discrimination, a taste for discrimination on the part of an employer against black workers means that the employer perceives that
A)black workers are less productive than white workers.
B)the wage of black workers is higher than their true wage.
C)black workers have higher pecuniary and nonpecuniary costs than white workers.
D)the wage of white worker is lower than their true wage.
3

The discrimination coefficient is the perceived
A)wage premium if the employee is black.
B)wage discount if the employee is white.
C)productivity discount if the employee is black.
D)productivity premium if the employee is white.
4

An employer who has a taste for discrimination against black workers is predicted
A)to have a segregated workforce.
B)to hire only black workers if the owner's taste for discrimination is less than the market's discount for hiring black workers.
C)both (A) and (B).
D)neither (A) nor (B).
5

In a competitive labor market, employers with a taste for discrimination
A)hire more than the optimal amount of workers if they have an "all-white" workforce.
B)hire less than the optimal amount of workers if they have an "all-black" workforce.
C)both (A) and (B).
D)neither (A) nor (B).
6

A policy implication of the model of employer-based discrimination is that
A)discrimination cannot persist in a competitive market.
B)competition among firms harms minority workers by bidding down minority wages to insure profitability.
C)active intervention in the labor market is necessary in order for wage equality between racial groups to be achieved.
D)both (B) and (C).
E)all of the above.
7

In equilibrium, the relative black wage (i.e., the wage of blacks divided by the wage of white)
A)will always be less than one if no employer has a taste for hiring blacks over whites.
B)is determined by the supply and demand for black workers.
C)declines as the supply of black workers increases.
D)both (B) and (C).
E)all of the above.
8

The model of employee-based discrimination predicts that if male employees have a taste for discrimination against female employees then
A)male employees will receive a wage premium.
B)firms will be segregated by gender.
C)male employees will earn more than female employees.
D)both (A) and (B).
E)all of the above.
9

The model of customer-based discrimination predicts that if women prefer female gynecologists, then a male gynecologist
A)will earn less than a comparably-skilled female gynecologist.
B)will be more qualified than a comparably paid female gynecologist.
C)will earn a lower rate of return on his human capital investment than a comparably skilled female gynecologist.
D)possibly all of the above.
E)none of the above.
10

Customer discrimination
A)is predicted to be driven from the market by firms maximizing profits.
B)can lead to women and minorities having a lower value of marginal product even when they are equally productive.
C)might lead to gender segregation among the different jobs within a firm.
D)both (B) and (C).
E)all of the above.





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