Question 1

Which of the following is NOT a reason why the labour force participation for women has increased over the past 100 years?

Accepted Answer

A)  the increase in technology that speeds up the time it takes to do household tasks 
B)  the reduced number of children per family 
C)  the change in political and social values 
D)  the steady decrease in the labour force participation for men over the same time period 
A)  the increase in technology that speeds up the time it takes to do household tasks 
B)  the reduced number of children per family 
C)  the change in political and social values 
D)  the steady decrease in the labour force participation for men over the same time period

Question 2

Aaron is the owner of a firm that produces wind power in southern Alberta. There are many such firms in the area. Aaron decides that if he pays his workers a wage higher than the going market wage, his profits will increase. What is a likely explanation for his decision?

Accepted Answer

A)  The higher the wage, the less often his workers will choose to leave his firm. 
B)  The higher the wage, the lower will be the cost of obtaining needed supplies. 
C)  The higher the wage, the more he can charge for his wind power. 
D)  The higher the wage, the less competition will be in the industry. 
A)  The higher the wage, the less often his workers will choose to leave his firm. 
B)  The higher the wage, the lower will be the cost of obtaining needed supplies. 
C)  The higher the wage, the more he can charge for his wind power. 
D)  The higher the wage, the less competition will be in the industry.

Question 3

Which statement best explains how unemployment relates to business cycles?

Accepted Answer

A)  Unemployment can be eliminated through economic policies when the economy grows at normal rates. 
B)  Unemployment only exists during periods of economic slowdown. 
C)  Cyclical unemployment is inversely related to short-run economic fluctuations. 
D)  Unemployment is unrelated to short-run economic fluctuations. 
A)  Unemployment can be eliminated through economic policies when the economy grows at normal rates. 
B)  Unemployment only exists during periods of economic slowdown. 
C)  Cyclical unemployment is inversely related to short-run economic fluctuations. 
D)  Unemployment is unrelated to short-run economic fluctuations.

Question 4

How does Statistics Canada call a person who has a temporary, part-time job?

Accepted Answer

A)  not in the labour force 
B)  unemployed 
C)  partially employed 
D)  employed 
A)  not in the labour force 
B)  unemployed 
C)  partially employed 
D)  employed

Question 5

Over the past 50 years, which region of Canada generally has had the lowest unemployment rates?

Accepted Answer

A)  Atlantic Canada 
B)  Quebec 
C)  Ontario 
D)  Western Canada 
A)  Atlantic Canada 
B)  Quebec 
C)  Ontario 
D)  Western Canada

Question 6

Suppose that some people report themselves as unemployed when, in fact, they are working in the underground economy. If these persons were counted as employed, how would the labour statistics change?

Accepted Answer

A)  The unemployment rate and the labour-force participation rate would be higher. 
B)  The unemployment rate and the labour-force participation rate would be lower. 
C)  The unemployment rate would be higher, and the labour-force participation rate would be lower. 
D)  The unemployment rate would be lower, and the labour-force participation rate would be unaffected. 
A)  The unemployment rate and the labour-force participation rate would be higher. 
B)  The unemployment rate and the labour-force participation rate would be lower. 
C)  The unemployment rate would be higher, and the labour-force participation rate would be lower. 
D)  The unemployment rate would be lower, and the labour-force participation rate would be unaffected.

Question 7

According to efficiency wage theory, what is a way to increase employees' work effort?

Accepted Answer

A)  increase wages 
B)  increase the number of supervisors 
C)  decrease wages 
D)  reduce the number of supervisors 
A)  increase wages 
B)  increase the number of supervisors 
C)  decrease wages 
D)  reduce the number of supervisors

Question 8

How often is data on unemployment reported?

Accepted Answer

A)  weekly 
B)  monthly 
C)  quarterly 
D)  yearly 
A)  weekly 
B)  monthly 
C)  quarterly 
D)  yearly

Question 9

A minimum wage above equilibrium creates a labour surplus.

Accepted Answer

A) True 
 B)False

Question 10

What is, approximately, the percentage of unionized public workers in Canada?

Accepted Answer

A)  30 percent 
B)  40 percent 
C)  60 percent 
D)  70 percent 
A)  30 percent 
B)  40 percent 
C)  60 percent 
D)  70 percent

Question 11

How is the unemployment rate computed?

Accepted Answer

A)  as the number of unemployed divided by the labour force times 100 
B)  as the number of unemployed divided by the number of people employed times 100 
C)  as the number of unemployed divided by the adult population times 100 
D)  as the number of unemployed times the participation rate times 100 
A)  as the number of unemployed divided by the labour force times 100 
B)  as the number of unemployed divided by the number of people employed times 100 
C)  as the number of unemployed divided by the adult population times 100 
D)  as the number of unemployed times the participation rate times 100

Question 12

Which statement best defines "job search"?

Accepted Answer

A)  It is a process through which the firms determine the equilibrium wage. 
B)  It is an imbalance between labour supply and labour demand. 
C)  It is the process of matching workers with appropriate jobs. 
D)  It is the process through which firms hire new employees. 
A)  It is a process through which the firms determine the equilibrium wage. 
B)  It is an imbalance between labour supply and labour demand. 
C)  It is the process of matching workers with appropriate jobs. 
D)  It is the process through which firms hire new employees.

Question 13

In 2018, how much did the government budget for the EI program?

Accepted Answer

A)  about $5 billion 
B)  about $10 billion 
C)  about $15 million 
D)  about $20 billion 
A)  about $5 billion 
B)  about $10 billion 
C)  about $15 million 
D)  about $20 billion

Question 14

Which cause of unemployment is NOT associated with a wage rate above the equilibrium level?

Accepted Answer

A)  unions 
B)  efficiency wages 
C)  employment insurance 
D)  minimum-wage laws 
A)  unions 
B)  efficiency wages 
C)  employment insurance 
D)  minimum-wage laws

Question 15

Government policy can do nothing about the natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 16

What impact do employment insurance and unions have on unemployment?

Accepted Answer

A)  Unemployment insurance and unions both create structural unemployment. 
B)  Unemployment insurance and unions both create frictional unemployment. 
C)  Unemployment insurance creates frictional unemployment, and unions create structural unemployment. 
D)  Unemployment insurance creates structural unemployment, and unions create frictional unemployment. 
A)  Unemployment insurance and unions both create structural unemployment. 
B)  Unemployment insurance and unions both create frictional unemployment. 
C)  Unemployment insurance creates frictional unemployment, and unions create structural unemployment. 
D)  Unemployment insurance creates structural unemployment, and unions create frictional unemployment.

Question 17

Consider an economy where population increases, which in turn causes both the demand for goods and services and the supply of labour to increase.
a. In a labour supply and demand diagram, analyze the effects of the increase in population on the equilibrium wage and employment.
b. What happens to wage and unemployment if a minimum-wage law exists?

Accepted Answer

a. The increase in demand for goods and

Question 18

When unions raise wages in some sectors of the economy, what happens to the supply of labour in other sectors of the economy?

Accepted Answer

A)  It decreases, raising wages in industries that are not unionized. 
B)  It decreases, reducing wages in industries that are not unionized. 
C)  It increases, raising wages in industries that are not unionized. 
D)  It increases, reducing wages in industries that are not unionized. 
A)  It decreases, raising wages in industries that are not unionized. 
B)  It decreases, reducing wages in industries that are not unionized. 
C)  It increases, raising wages in industries that are not unionized. 
D)  It increases, reducing wages in industries that are not unionized.

Question 19

Mary Ellen is the newly appointed CEO of a company that packages cereal on an assembly line. Her staff has told her that the output the firm produces, given the number of workers employed, indicates that some workers may be shirking. According to efficiency wage theory, what should she do?

Accepted Answer

A)  pay all workers more than the equilibrium wage rate 
B)  pay all workers below the equilibrium wage rate to make up for the loss from shirking 
C)  make sure that workers are getting paid exactly the equilibrium wage rate 
D)  reduce production 
A)  pay all workers more than the equilibrium wage rate 
B)  pay all workers below the equilibrium wage rate to make up for the loss from shirking 
C)  make sure that workers are getting paid exactly the equilibrium wage rate 
D)  reduce production

Question 20

What is the effect of unions on wages and employment?

Accepted Answer

A)  Unions are unlikely to affect wages and employment. 
B)  Unions raise wages above the competitive equilibrium level. 
C)  Unions increase the level of employment in unionized firms. 
D)  Unions decrease the level of employment in nonunionized firms. 
A)  Unions are unlikely to affect wages and employment. 
B)  Unions raise wages above the competitive equilibrium level. 
C)  Unions increase the level of employment in unionized firms. 
D)  Unions decrease the level of employment in nonunionized firms.

Which of the following is NOT a reason why the labour force participation for women has increased over the past 100 years?

Aaron is the owner of a firm that produces wind power in southern Alberta. There are many such firms in the area. Aaron decides that if he pays his workers a wage higher than the going market wage, his profits will increase. What is a likely explanation for his decision?

Which statement best explains how unemployment relates to business cycles?

How does Statistics Canada call a person who has a temporary, part-time job?

Over the past 50 years, which region of Canada generally has had the lowest unemployment rates?

Suppose that some people report themselves as unemployed when, in fact, they are working in the underground economy. If these persons were counted as employed, how would the labour statistics change?

According to efficiency wage theory, what is a way to increase employees' work effort?

How often is data on unemployment reported?

A minimum wage above equilibrium creates a labour surplus.

What is, approximately, the percentage of unionized public workers in Canada?

How is the unemployment rate computed?

Which statement best defines "job search"?

In 2018, how much did the government budget for the EI program?

Which cause of unemployment is NOT associated with a wage rate above the equilibrium level?

Government policy can do nothing about the natural rate of unemployment.

What impact do employment insurance and unions have on unemployment?

When unions raise wages in some sectors of the economy, what happens to the supply of labour in other sectors of the economy?

Mary Ellen is the newly appointed CEO of a company that packages cereal on an assembly line. Her staff has told her that the output the firm produces, given the number of workers employed, indicates that some workers may be shirking. According to efficiency wage theory, what should she do?

What is the effect of unions on wages and employment?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary Policy on Aggregate Demand

The Influence of Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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Exam 9: Unemployment and Its Natural Rate

Which of the following is NOT a reason why the labour force participation for women has increased over the past 100 years?

Aaron is the owner of a firm that produces wind power in southern Alberta. There are many such firms in the area. Aaron decides that if he pays his workers a wage higher than the going market wage, his profits will increase. What is a likely explanation for his decision?

Which statement best explains how unemployment relates to business cycles?

How does Statistics Canada call a person who has a temporary, part-time job?

Over the past 50 years, which region of Canada generally has had the lowest unemployment rates?

Suppose that some people report themselves as unemployed when, in fact, they are working in the underground economy. If these persons were counted as employed, how would the labour statistics change?

According to efficiency wage theory, what is a way to increase employees' work effort?

How often is data on unemployment reported?

A minimum wage above equilibrium creates a labour surplus.

What is, approximately, the percentage of unionized public workers in Canada?

How is the unemployment rate computed?

Which statement best defines "job search"?

In 2018, how much did the government budget for the EI program?

Which cause of unemployment is NOT associated with a wage rate above the equilibrium level?

Government policy can do nothing about the natural rate of unemployment.

What impact do employment insurance and unions have on unemployment?

When unions raise wages in some sectors of the economy, what happens to the supply of labour in other sectors of the economy?

Mary Ellen is the newly appointed CEO of a company that packages cereal on an assembly line. Her staff has told her that the output the firm produces, given the number of workers employed, indicates that some workers may be shirking. According to efficiency wage theory, what should she do?

What is the effect of unions on wages and employment?

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Small Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary Policy on Aggregate Demand

The Influence of Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

Filters