Question 1

Table 28-3
2009 Labor Data for Baltivia  
-Refer to Table 28-3. How many adults were not in Baltivia's labor force in 2009?

Accepted Answer

A) 4,400 
B) 6,620 
C) 7,400 
D) 8,690 
A) 4,400 
B) 6,620 
C) 7,400 
D) 8,690

Question 2

Table 28-5
Labor Force Statistics by Age
Suppose people in the adult population in a small country are classified based on their age.  
-Refer to Table 28-5. In the proper order, which age group has the highest unemployment rate and which has the highest participation rate?

Accepted Answer

A) under 55, under 55 
B) under 55, 55 and older 
C) 55 and older, under 55 
D) 55 and older, 55 and older 
A) under 55, under 55 
B) under 55, 55 and older 
C) 55 and older, under 55 
D) 55 and older, 55 and older

Question 3

Unemployment data is collected

Accepted Answer

A) through a monthly survey of about 20,000 firms. 
B) through a monthly survey of about 60,000 households. 
C) from unemployment insurance claims. 
D) All of the above are correct. 
A) through a monthly survey of about 20,000 firms. 
B) through a monthly survey of about 60,000 households. 
C) from unemployment insurance claims. 
D) All of the above are correct.

Question 4

Most spells of unemployment are short, and most unemployment observed at any given time is long-term.

Accepted Answer

A) True 
 B)False

Question 5

Suppose that an anti-smoking campaign in Moscow, Russia, is successful so that Muscovites smoke less and chew gum more. Tobacco companies lay off workers, while chewing gum manufacturers employ more workers. This is an example of

Accepted Answer

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

Question 6

Efficiency wages

Accepted Answer

A) raise the productivity of a firm's workers, so the firm hires more workers. 
B) raise the productivity of a firm's workers, so the firm hires fewer workers. 
C) reduce the productivity of a firms' workers, so the firm hires more workers. 
D) reduce the productivity of a firm's workers, so the firm hires fewer workers. 
A) raise the productivity of a firm's workers, so the firm hires more workers. 
B) raise the productivity of a firm's workers, so the firm hires fewer workers. 
C) reduce the productivity of a firms' workers, so the firm hires more workers. 
D) reduce the productivity of a firm's workers, so the firm hires fewer workers.

Question 7

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, the result is a shortage of labor.

Accepted Answer

A) True 
 B)False

Question 8

Discouraged workers are people who want to work but have given up trying to find a job after an unsuccessful search.

Accepted Answer

A) True 
 B)False

Question 9

The natural rate of unemployment

Accepted Answer

A) arises from a single problem that has a single solution. 
B) is easy for policymakers to reduce. 
C) Both a and b are correct. 
D) None of the above is correct. 
A) arises from a single problem that has a single solution. 
B) is easy for policymakers to reduce. 
C) Both a and b are correct. 
D) None of the above is correct.

Question 10

Suppose that garbage collectors and landscaping workers have no unions. Now suppose that garbage collectors form unions. What does this do to the labor supply and wages of landscaping workers?

Accepted Answer

A) Both labor supply and wages increase. 
B) Labor supply increases, and wages decrease. 
C) Labor supply decreases, and wages increase. 
D) both labor supply and wages increase. 
A) Both labor supply and wages increase. 
B) Labor supply increases, and wages decrease. 
C) Labor supply decreases, and wages increase. 
D) both labor supply and wages increase.

Question 11

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, there are more workers willing to work than there are jobs, so some workers are unemployed.

Accepted Answer

A) True 
 B)False

Question 12

Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well-being.

Accepted Answer

A) True 
 B)False

Question 13

Every adult who was not employed during the previous four weeks is included in the Bureau of Labor Statistics' "unemployed" category.

Accepted Answer

A) True 
 B)False

Question 14

Someone who has a job but is absent from work because she is on vacation is counted as "employed."

Accepted Answer

A) True 
 B)False

Question 15

In the long run the unemployment rate equals

Accepted Answer

A) zero. 
B) the cyclical rate of unemployment. 
C) the natural rate of unemployment. 
D) the sum of the cyclical and natural rate of unemployment. 
A) zero. 
B) the cyclical rate of unemployment. 
C) the natural rate of unemployment. 
D) the sum of the cyclical and natural rate of unemployment.

Question 16

A person who is counted as "unemployed" by the Bureau of Labor Statistics

Accepted Answer

A) is also in the labor force. 
B) must have recently looked for work or be on temporary layoff. 
C) must be at least 16 years old. 
D) All of the above are correct. 
A) is also in the labor force. 
B) must have recently looked for work or be on temporary layoff. 
C) must be at least 16 years old. 
D) All of the above are correct.

Question 17

Adults who were not working but who had jobs from which they were temporarily absent are included in the Bureau of Labor Statistics' "employed" category.

Accepted Answer

A) True 
 B)False

Question 18

Efficiency wages, minimum-wage laws, and unions all keep wages

Accepted Answer

A) below the equilibrium level, causing a shortage of labor. 
B) below the equilibrium level, causing a surplus of labor. 
C) above the equilibrium level, causing a shortage of labor. 
D) above the equilibrium level, causing a surplus of labor. 
A) below the equilibrium level, causing a shortage of labor. 
B) below the equilibrium level, causing a surplus of labor. 
C) above the equilibrium level, causing a shortage of labor. 
D) above the equilibrium level, causing a surplus of labor.

Question 19

Ignoring the differences across states, explain the benefit provided to the typical worker in the United States from unemployment insurance.

Accepted Answer

Worker receives 50%

Question 20

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

Accepted Answer

A) 55% 
B) 63% 
C) 66.9% 
D) 87.3% 
A) 55% 
B) 63% 
C) 66.9% 
D) 87.3%

Exam 28: Unemployment and Its Natural Rate

Table 28-3 2009 Labor Data for Baltivia -Refer to Table 28-3. How many adults were not in Baltivia's labor force in 2009?

Table 28-5 Labor Force Statistics by Age Suppose people in the adult population in a small country are classified based on their age. -Refer to Table 28-5. In the proper order, which age group has the highest unemployment rate and which has the highest participation rate?

Unemployment data is collected

Most spells of unemployment are short, and most unemployment observed at any given time is long-term.

Suppose that an anti-smoking campaign in Moscow, Russia, is successful so that Muscovites smoke less and chew gum more. Tobacco companies lay off workers, while chewing gum manufacturers employ more workers. This is an example of

Efficiency wages

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, the result is a shortage of labor.

Discouraged workers are people who want to work but have given up trying to find a job after an unsuccessful search.

The natural rate of unemployment

Suppose that garbage collectors and landscaping workers have no unions. Now suppose that garbage collectors form unions. What does this do to the labor supply and wages of landscaping workers?

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, there are more workers willing to work than there are jobs, so some workers are unemployed.

Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well-being.

Every adult who was not employed during the previous four weeks is included in the Bureau of Labor Statistics' "unemployed" category.

Someone who has a job but is absent from work because she is on vacation is counted as "employed."

In the long run the unemployment rate equals

A person who is counted as "unemployed" by the Bureau of Labor Statistics

Adults who were not working but who had jobs from which they were temporarily absent are included in the Bureau of Labor Statistics' "employed" category.

Efficiency wages, minimum-wage laws, and unions all keep wages

Ignoring the differences across states, explain the benefit provided to the typical worker in the United States from unemployment insurance.

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

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