Question 1

Someone who is without work but is not looking for work is included in the Bureau of Labor Statistics' "unemployed" category.

Accepted Answer

A) True 
 B)False

Question 2

Over the past several decades, the difference between the labor-force participation rates of men and women in the U.S. has gradually increased.

Accepted Answer

A) True 
 B)False

Question 3

The unemployment that results from the process of matching workers and jobs is called structural unemployment.

Accepted Answer

A) True 
 B)False

Question 4

Sectoral shifts contribute to frictional unemployment.

Accepted Answer

A) True 
 B)False

Question 5

Most U.S. workers have wages well above the legal minimum, so minimum-wage laws do not prevent the wage from adjusting to balance supply and demand.

Accepted Answer

A) True 
 B)False

Question 6

Suppose that the Bureau of Labor Statistics reported that there were 62 million people over age 25 whose highest level of education was some college or an associate degree. Of these, 45.3 million were employed and 3.6 million were unemployed. What were the labor-force participation rate and the unemployment rate for this group?

Accepted Answer

A) 7.4% and 78.9% 
B) 78.9% and 7.4% 
C) 126.8% and 7.4% 
D) 78.9% and 126.8% 
A) 7.4% and 78.9% 
B) 78.9% and 7.4% 
C) 126.8% and 7.4% 
D) 78.9% and 126.8%

Question 7

Octavia is a stay-at-home parent who has not searched for work in recent years. Michael does not currently have a job, but has applied for several jobs in the previous week. Who does the Bureau of Labor Statistics count as "not in the labor force"?

Accepted Answer

A) Michael but not Octavia 
B) Octavia but not Michael 
C) Both Michael and Octavia 
D) Neither Michael nor Octavia 
A) Michael but not Octavia 
B) Octavia but not Michael 
C) Both Michael and Octavia 
D) Neither Michael nor Octavia

Question 8

Explain how the following apparently contradictory statement can be true: Most spells of unemployment are short, and most unemployment observed at any given time is long-term.

Accepted Answer

Most people who become unemplo

Question 9

The Bureau of Labor Statistics computes labor-force participation rates for the entire adult population and for groups based on age, gender, and race.

Accepted Answer

A) True 
 B)False

Question 10

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, the quantity of labor supplied is higher and the quantity demanded of labor is lower than at the equilibrium wage.

Accepted Answer

A) True 
 B)False

Question 11

U.S. Department of Labor data show that minimum-wage workers tend to be young, less educated, more likely to be working part time, and concentrated in the leisure and hospitality industry.

Accepted Answer

A) True 
 B)False

Question 12

A minimum wage that is below the equilibrium wage rate does not raise unemployment.

Accepted Answer

A) True 
 B)False

Question 13

Table 28-3
​
​
 $$\begin{array} { | l | l | } 
\hline \text { Civilian labor force } & 100 \text { million } \
\hline \text { Persons unemployed } 15 \text { weeks or longer } & 1.6 \text { million } \
\hline \text { Job losers and persons who have completed temporary jobs (excludes job leavers) } & 3.1 \text { million } \
\hline \text { Total unemployed } & 6.2 \text { million } \
\hline \text { Total unemployed plus discouraged workers } & 7.0 \text { million } \
\hline \text { Total unemployed plus all marginally attached workers } & 8.1 \text { million } \
\hline \text { Total unemployed plus all marginally attached workers plus total employed part-time } & 9.2 \text { million } \
\text { for economic reasons } & \
\hline
\end{array}$$
-Refer to Table 28-3. What is the U-1 measure of labor underutilization?

Accepted Answer

A) 1.6% 
B) 3.1% 
C) 6.2% 
D) 7.0% 
A) 1.6% 
B) 3.1% 
C) 6.2% 
D) 7.0%

Question 14

Unemployment generated by the existence of labor unions is structural unemployment and so contributes to the natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 15

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

Accepted Answer

A) True 
 B)False

Question 16

The unemployment rate equals the percentage of the adult population that is unemployed.

Accepted Answer

A) True 
 B)False

Question 17

Suppose that a large number of people who used to work or seek work no longer do either. Other things the same, this makes

Accepted Answer

A) the number of people unemployed rise but does not change the labor force. 
B) the number of people unemployed rise but makes the labor force fall. 
C) both the number of people unemployed and in the labor force fall. 
D) the number of people unemployed fall but does not change the labor force. 
A) the number of people unemployed rise but does not change the labor force. 
B) the number of people unemployed rise but makes the labor force fall. 
C) both the number of people unemployed and in the labor force fall. 
D) the number of people unemployed fall but does not change the labor force.

Question 18

A labor union is similar to a __________.

Accepted Answer

The answer of A labor union is similar to a...

Question 19

Table 28-2
Suppose people in the adult population in a small country are classified based on their age.
​
​
   ​
-Refer to Table 28-2. Suppose that the natural rate of unemployment is 5% for those under 55 and 3% for those 55 and older. The cyclical unemployment rate for those under 55 is

Accepted Answer

A) 0.88%, which is greater than the cyclical unemployment rate for those 55 and older. 
B) 0.88%, which is less than the cyclical unemployment rate for those 55 and older. 
C) −0.83%, which is greater than the cyclical unemployment rate for those 55 and older. 
D) −0.83%, which is less than the cyclical unemployment rate for those 55 and older. 
A) 0.88%, which is greater than the cyclical unemployment rate for those 55 and older. 
B) 0.88%, which is less than the cyclical unemployment rate for those 55 and older. 
C) −0.83%, which is greater than the cyclical unemployment rate for those 55 and older. 
D) −0.83%, which is less than the cyclical unemployment rate for those 55 and older.

Question 20

The demand for workers often rises in one region of the U.S. and falls in another. This illustrates

Accepted Answer

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

Exam 28: Unemployment and Its Natural Rate

Someone who is without work but is not looking for work is included in the Bureau of Labor Statistics' "unemployed" category.

Over the past several decades, the difference between the labor-force participation rates of men and women in the U.S. has gradually increased.

The unemployment that results from the process of matching workers and jobs is called structural unemployment.

Sectoral shifts contribute to frictional unemployment.

Most U.S. workers have wages well above the legal minimum, so minimum-wage laws do not prevent the wage from adjusting to balance supply and demand.

Octavia is a stay-at-home parent who has not searched for work in recent years. Michael does not currently have a job, but has applied for several jobs in the previous week. Who does the Bureau of Labor Statistics count as "not in the labor force"?

Explain how the following apparently contradictory statement can be true: Most spells of unemployment are short, and most unemployment observed at any given time is long-term.

The Bureau of Labor Statistics computes labor-force participation rates for the entire adult population and for groups based on age, gender, and race.

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, the quantity of labor supplied is higher and the quantity demanded of labor is lower than at the equilibrium wage.

U.S. Department of Labor data show that minimum-wage workers tend to be young, less educated, more likely to be working part time, and concentrated in the leisure and hospitality industry.

A minimum wage that is below the equilibrium wage rate does not raise unemployment.

Unemployment generated by the existence of labor unions is structural unemployment and so contributes to the natural rate of unemployment.

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

The unemployment rate equals the percentage of the adult population that is unemployed.

Suppose that a large number of people who used to work or seek work no longer do either. Other things the same, this makes

A labor union is similar to a __________.

Table 28-2 Suppose people in the adult population in a small country are classified based on their age. ​ ​ ​ -Refer to Table 28-2. Suppose that the natural rate of unemployment is 5% for those under 55 and 3% for those 55 and older. The cyclical unemployment rate for those under 55 is

The demand for workers often rises in one region of the U.S. and falls in another. This illustrates

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 Nations 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

Table 28-2 Suppose people in the adult population in a small country are classified based on their age. -Refer to Table 28-2. Suppose that the natural rate of unemployment is 5% for those under 55 and 3% for those 55 and older. The cyclical unemployment rate for those under 55 is