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Unformatted text preview: o cut wages. a relative-wage contract. Answer: B Diff: 1 Topic: Explaining the Existence of Unemployment Skill: Conceptual AACSB: Reflective Thinking 9) Frito Lay ed a 20% drop in its sales. Even though the demand for its product decreased, Frito Lay did not cut the experienc wages of its nonunionized workers. This is an example of A) an explicit B) contract not to cut wages. employment-at- will. C) poor D) management. an implicit or social contract not to cut wages. Answer: D Diff: 1 Topic: Explaining the Existence of Unemployment Skill: Conceptual AACSB: Reflective Thinking 10) Suppose airline workers are laid off during a recession because of an unspoken agreement between airline that workers and airline executives that wages will not be reduced. This example is consistent with the A) relative-wage explanation of unemployment. B) explicit contract explanation of unemployment. C) implicit contract explanation of unemployment. D) efficiency wage explanation of unemployment. Answer: C Diff: 1 Topic: Explaining the Existenc...
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This note was uploaded on 06/02/2013 for the course ECON 130 taught by Professor Meshew during the Fall '13 term at Victoria Wellington.
- Fall '13