Question 1

What is the theory of efficiency wages? Provide four reasons that employers might pay efficiency wages.

Accepted Answer

According to the theory of efficiency wa

Question 2

Suppose that the Bureau of Labor Statistics predicts that the number of jobs for dental hygienists will grow faster than most occupations while the number of jobs for bookbinders will decline. This change in the labor market could lead to

Accepted Answer

A) frictional unemployment created by efficiency wages. 
B) structural unemployment created by efficiency wages. 
C) frictional unemployment created by sectoral shifts. 
D) structural unemployment created by sectoral shifts. 
A) frictional unemployment created by efficiency wages. 
B) structural unemployment created by efficiency wages. 
C) frictional unemployment created by sectoral shifts. 
D) structural unemployment created by sectoral shifts.

Question 3

Minimum-wage laws

Accepted Answer

A) reduce unemployment. 
B) cause labor shortages, which further raise wages above equilibrium. 
C) affect highly-educated workers more than high school dropouts. 
D) None of the above is correct. 
A) reduce unemployment. 
B) cause labor shortages, which further raise wages above equilibrium. 
C) affect highly-educated workers more than high school dropouts. 
D) None of the above is correct.

Question 4

The normal rate of unemployment around which the unemployment rate fluctuates is called the natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 5

The normal rate of unemployment around which the unemployment rate fluctuates is called cyclical unemployment.

Accepted Answer

A) True 
 B)False

Question 6

Economists at the Congressional Budget Office estimated that for 2015, the U.S. natural rate of unemployment was about 4.9 percent.​

Accepted Answer

A) True 
 B)False

Question 7

Table 28-3
2009 Labor Data for Baltivia  
-Refer to Table 28-3. What was Baltivia's unemployment rate in 2009?

Accepted Answer

A) 8.0% 
B) 12.7% 
C) 15.9% 
D) 22.1% 
A) 8.0% 
B) 12.7% 
C) 15.9% 
D) 22.1%

Question 8

Efficiency-wage theory suggests that paying

Accepted Answer

A) low wages might be profitable because they raise the efficiency of a firm's workers. 
B) low wages might be profitable because they lower the efficiency of a firm's workers. 
C) high wages might be profitable because they raise the efficiency of a firm's workers. 
D) high wages might be profitable because they lower the efficiency of a firm's workers. 
A) low wages might be profitable because they raise the efficiency of a firm's workers. 
B) low wages might be profitable because they lower the efficiency of a firm's workers. 
C) high wages might be profitable because they raise the efficiency of a firm's workers. 
D) high wages might be profitable because they lower the efficiency of a firm's workers.

Question 9

Measuring the amount of unemployment in the economy is a straightforward task.

Accepted Answer

A) True 
 B)False

Question 10

In Belgium, Norway, and Sweden, the percentage of workers who belong to unions is

Accepted Answer

A) almost zero. 
B) less than it is in the United States. 
C) about the same as it is in the United States. 
D) greater than it is in the United States. 
A) almost zero. 
B) less than it is in the United States. 
C) about the same as it is in the United States. 
D) greater than it is in the United States.

Question 11

Government-run employment agencies and public training programs are operated by the government to try to facilitate job search and reduce unemployment.

Accepted Answer

A) Almost all economists agree that such programs are of no use. 
B) Almost all economists agree that such programs work very well. 
C) Some economists claim that the government can do these things no better than firms and individuals could do them for themselves. 
D) Some economists claim that these programs increase frictional unemployment. 
A) Almost all economists agree that such programs are of no use. 
B) Almost all economists agree that such programs work very well. 
C) Some economists claim that the government can do these things no better than firms and individuals could do them for themselves. 
D) Some economists claim that these programs increase frictional unemployment.

Question 12

Over the past several decades in the United States, the labor-force participation rate of women has

Accepted Answer

A) increased, and the labor-force participation rate of men has increased. 
B) increased, and the labor-force participation rate of men has decreased. 
C) decreased, and the labor-force participation rate of men has increased. 
D) decreased, and the labor-force participation rate of men has decreased. 
A) increased, and the labor-force participation rate of men has increased. 
B) increased, and the labor-force participation rate of men has decreased. 
C) decreased, and the labor-force participation rate of men has increased. 
D) decreased, and the labor-force participation rate of men has decreased.

Question 13

A firm might offer efficiency wages to reduce worker turnover and thereby reduce production costs.

Accepted Answer

A) True 
 B)False

Question 14

The unemployed who quit their jobs, were fired for cause, or just entered the labor force are eligible for unemployment insurance.

Accepted Answer

A) True 
 B)False

Question 15

According to 2014 data on the U.S. population, which of the following was correct for the adult population of prime working age, ages 25-54?

Accepted Answer

A) Black males had higher labor-force participation rates and lower unemployment rates compared to white males. 
B) Black males had both higher labor-force participation rates and higher unemployment rates compared to white males. 
C) Black males had both lower labor-force participation rates and lower unemployment rates compared to white males. 
D) Black males had lower labor-force participation rates and higher unemployment rates compared to white males. 
A) Black males had higher labor-force participation rates and lower unemployment rates compared to white males. 
B) Black males had both higher labor-force participation rates and higher unemployment rates compared to white males. 
C) Black males had both lower labor-force participation rates and lower unemployment rates compared to white males. 
D) Black males had lower labor-force participation rates and higher unemployment rates compared to white males.

Question 16

Labor unions

Accepted Answer

A) prefer to operate in states with right-to-work laws. 
B) are similar to cartels. 
C) play a larger role in the current U.S. economy than in European countries such as Norway and Sweden. 
D) attract a membership of about 25 percent of current U.S. workers. 
A) prefer to operate in states with right-to-work laws. 
B) are similar to cartels. 
C) play a larger role in the current U.S. economy than in European countries such as Norway and Sweden. 
D) attract a membership of about 25 percent of current U.S. workers.

Question 17

There are always some workers without jobs, even when the overall economy is doing well.

Accepted Answer

A) True 
 B)False

Question 18

Suppose that the adult population in some country is 225 million. If 40 million are unemployed and 100 million are employed, then the unemployment rate is approximately

Accepted Answer

A) 29%. 
B) 18%. 
C) 24%. 
D) 6%. 
A) 29%. 
B) 18%. 
C) 24%. 
D) 6%.

Question 19

A person who is not employed and claims to be trying hard to find a job but really is not trying hard to find a job is

Accepted Answer

A) counted as out of the labor force but should be counted as unemployed. 
B) counted as unemployed but should be counted as out of the labor force. 
C) correctly counted as out of the labor force. 
D) correctly counted as unemployed. 
A) counted as out of the labor force but should be counted as unemployed. 
B) counted as unemployed but should be counted as out of the labor force. 
C) correctly counted as out of the labor force. 
D) correctly counted as unemployed.

Question 20

Because people move into and out of the labor force so often, statistics on unemployment are difficult to interpret.

Accepted Answer

A) True 
 B)False

Exam 28: Unemployment and Its Natural Rate

What is the theory of efficiency wages? Provide four reasons that employers might pay efficiency wages.

Suppose that the Bureau of Labor Statistics predicts that the number of jobs for dental hygienists will grow faster than most occupations while the number of jobs for bookbinders will decline. This change in the labor market could lead to

Minimum-wage laws

The normal rate of unemployment around which the unemployment rate fluctuates is called the natural rate of unemployment.

The normal rate of unemployment around which the unemployment rate fluctuates is called cyclical unemployment.

Economists at the Congressional Budget Office estimated that for 2015, the U.S. natural rate of unemployment was about 4.9 percent.​

Table 28-3 2009 Labor Data for Baltivia -Refer to Table 28-3. What was Baltivia's unemployment rate in 2009?

Efficiency-wage theory suggests that paying

Measuring the amount of unemployment in the economy is a straightforward task.

In Belgium, Norway, and Sweden, the percentage of workers who belong to unions is

Government-run employment agencies and public training programs are operated by the government to try to facilitate job search and reduce unemployment.

Over the past several decades in the United States, the labor-force participation rate of women has

A firm might offer efficiency wages to reduce worker turnover and thereby reduce production costs.

The unemployed who quit their jobs, were fired for cause, or just entered the labor force are eligible for unemployment insurance.

According to 2014 data on the U.S. population, which of the following was correct for the adult population of prime working age, ages 25-54?

Labor unions

There are always some workers without jobs, even when the overall economy is doing well.

Suppose that the adult population in some country is 225 million. If 40 million are unemployed and 100 million are employed, then the unemployment rate is approximately

A person who is not employed and claims to be trying hard to find a job but really is not trying hard to find a job is

Because people move into and out of the labor force so often, statistics on unemployment are difficult to interpret.

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Applications: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Measuring a Nation S Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

Tools of Finance

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Tradeoff Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

Filters

Economists at the Congressional Budget Office estimated that for 2015, the U.S. natural rate of unemployment was about 4.9 percent.