Question 1

Which of the following about unemployment is true?

Accepted Answer

A)  The unemployment rates of the major European economies have been lower than the United States during the last decade. 
B)  The natural rate of unemployment is unaffected by labor market regulations and other dimensions of public policy. 
C)  High unemployment rates over lengthy time periods are indicative of structural factors that are adversely affecting the natural rate of unemployment. 
D)  The unemployment rates of Spain and Italy were among the lowest in the world during the past two decades. 
A)  The unemployment rates of the major European economies have been lower than the United States during the last decade. 
B)  The natural rate of unemployment is unaffected by labor market regulations and other dimensions of public policy. 
C)  High unemployment rates over lengthy time periods are indicative of structural factors that are adversely affecting the natural rate of unemployment. 
D)  The unemployment rates of Spain and Italy were among the lowest in the world during the past two decades.

Question 2

The natural rate of unemployment

Accepted Answer

A)  is an artificially low rate that cannot be maintained. 
B)  is a constant rate that is unaffected by changes in public policy. 
C)  is the rate of unemployment present when the economy is operating at full employment. 
D)  is equal to the number of persons unemployed divided by the number in the labor force. 
A)  is an artificially low rate that cannot be maintained. 
B)  is a constant rate that is unaffected by changes in public policy. 
C)  is the rate of unemployment present when the economy is operating at full employment. 
D)  is equal to the number of persons unemployed divided by the number in the labor force.

Question 3

The current U.S. unemployment insurance program

Accepted Answer

A)  tends to significantly lower the unemployment rate. 
B)  tends to modestly lower the unemployment rate. 
C)  has no effect on the unemployment rate. 
D)  tends to raise the unemployment rate. 
A)  tends to significantly lower the unemployment rate. 
B)  tends to modestly lower the unemployment rate. 
C)  has no effect on the unemployment rate. 
D)  tends to raise the unemployment rate.

Question 4

The unemployment rate is defined as the number of

Accepted Answer

A)  unemployed individuals divided by the number of employed individuals. 
B)  employed individuals divided by the number of individuals in the working-age population. 
C)  unemployed individuals divided by the number of individuals in the working-age population. 
D)  unemployed individuals divided by the number of individuals employed plus the number of unemployed. 
A)  unemployed individuals divided by the number of employed individuals. 
B)  employed individuals divided by the number of individuals in the working-age population. 
C)  unemployed individuals divided by the number of individuals in the working-age population. 
D)  unemployed individuals divided by the number of individuals employed plus the number of unemployed.

Question 5

Which of the following best explains why the rate of unemployment is highest among individuals aged 16 through 19?

Accepted Answer

A)  Teenagers do not have the skills necessary to find jobs. 
B)  Teenagers change jobs more frequently than do older individuals. 
C)  Teenagers have a higher labor force participation rate than other age groups. 
D)  Most teenagers are in school and, for this reason, are not holding jobs. 
A)  Teenagers do not have the skills necessary to find jobs. 
B)  Teenagers change jobs more frequently than do older individuals. 
C)  Teenagers have a higher labor force participation rate than other age groups. 
D)  Most teenagers are in school and, for this reason, are not holding jobs.

Question 6

The labor force participation rate is defined as the number of

Accepted Answer

A)  unemployed individuals plus employed individuals divided by the number of individuals in the working-age population. 
B)  employed individuals divided by the number of individuals in the working-age population. 
C)  unemployed individuals plus employed individuals divided by the number of employed individuals. 
D)  employed individuals divided by the number of individuals employed plus the number of unemployed individuals. 
A)  unemployed individuals plus employed individuals divided by the number of individuals in the working-age population. 
B)  employed individuals divided by the number of individuals in the working-age population. 
C)  unemployed individuals plus employed individuals divided by the number of employed individuals. 
D)  employed individuals divided by the number of individuals employed plus the number of unemployed individuals.

Question 7

Suppose an economy is operating at its maximum sustainable output rate. Neither recession nor economic boom are present. Which of the following would be true?

Accepted Answer

A)  The economy would be considered at full employment. 
B)  Actual GDP would exceed potential GDP. 
C)  Actual unemployment will be less than the natural rate of unemployment. 
D)  One hundred percent of the labor force is employed. 
A)  The economy would be considered at full employment. 
B)  Actual GDP would exceed potential GDP. 
C)  Actual unemployment will be less than the natural rate of unemployment. 
D)  One hundred percent of the labor force is employed.

Question 8

The natural rate of unemployment occurs if there is no

Accepted Answer

A)  unemployment. 
B)  frictional unemployment. 
C)  structural unemployment. 
D)  cyclical unemployment. 
A)  unemployment. 
B)  frictional unemployment. 
C)  structural unemployment. 
D)  cyclical unemployment.

Question 9

Terrell, an auto repair mechanic who remains unemployed because he refuses to work for less than $1,000 an hour, is

Accepted Answer

A)  counted as part of the labor force. 
B)  considered frictionally unemployed. 
C)  an underemployed worker. 
D)  not counted as part of the labor force. 
E)  considered as productively active. 
A)  counted as part of the labor force. 
B)  considered frictionally unemployed. 
C)  an underemployed worker. 
D)  not counted as part of the labor force. 
E)  considered as productively active.

Question 10

Which of the following types of unemployment can exist in an economy that is at its potential output level?

Accepted Answer

A)  cyclical unemployment only 
B)  structural unemployment only 
C)  frictional, cyclical, and seasonal unemployment only 
D)  frictional, seasonal, and structural unemployment only 
E)  there will be no unemployment in an economy that is at the potential output level 
A)  cyclical unemployment only 
B)  structural unemployment only 
C)  frictional, cyclical, and seasonal unemployment only 
D)  frictional, seasonal, and structural unemployment only 
E)  there will be no unemployment in an economy that is at the potential output level

Question 11

Suppose the population (age 16 and over) of Indonesia is 200 million; 9 million are unemployed, and 111 million hold jobs. Indicate the rate of unemployment and the employment/population ratio of Madagascar.

Accepted Answer

A)  The unemployment rate is 4.5 percent, and the employment/population ratio is 55.5 percent. 
B)  The unemployment rate is 7.5 percent, and the employment/population ratio is 60 percent. 
C)  The unemployment rate is 7.5 percent, and the employment/population ratio is 55.5 percent. 
D)  The unemployment rate is 8.1 percent, and the employment/population ratio is 60 percent. 
A)  The unemployment rate is 4.5 percent, and the employment/population ratio is 55.5 percent. 
B)  The unemployment rate is 7.5 percent, and the employment/population ratio is 60 percent. 
C)  The unemployment rate is 7.5 percent, and the employment/population ratio is 55.5 percent. 
D)  The unemployment rate is 8.1 percent, and the employment/population ratio is 60 percent.

Question 12

Which of the following will most likely reduce the natural rate of unemployment?

Accepted Answer

A)  an increase in the minimum wage 
B)  an increase in unemployment benefits 
C)  an increase in the proportion of prime-age workers (35-54) as a share of the labor force 
D)  an increase in the labor force participation rate of teenagers 
A)  an increase in the minimum wage 
B)  an increase in unemployment benefits 
C)  an increase in the proportion of prime-age workers (35-54) as a share of the labor force 
D)  an increase in the labor force participation rate of teenagers

Question 13

The unemployment rate will increase whenever there is

Accepted Answer

A)  an increase in the number of persons classified as unemployed. 
B)  an increase in the number of unemployed persons relative to the size of the labor force. 
C)  an increase in the size of the U.S. population and there is no change in the number of persons classified as employed. 
D)  a reduction in the size of the labor force while the number of unemployed decreases. 
A)  an increase in the number of persons classified as unemployed. 
B)  an increase in the number of unemployed persons relative to the size of the labor force. 
C)  an increase in the size of the U.S. population and there is no change in the number of persons classified as employed. 
D)  a reduction in the size of the labor force while the number of unemployed decreases.

Question 14

Suppose there are 25,000 employed and 5,000 unemployed persons.
a.What is the unemployment rate?
b.If 2,000 of those unemployed became discouraged and quit actively seeking work, what would happen to the unemployment rate? Calculate the new unemployment rate.

Accepted Answer

a.16.67 pe

Question 15

Suppose the population (age 16 and over) of Japan is 100 million; 5 million are unemployed, and 70 million hold jobs. The employment/population ratio of Guatemala is

Accepted Answer

A)  5 percent. 
B)  65 percent. 
C)  70 percent. 
D)  85 percent. 
A)  5 percent. 
B)  65 percent. 
C)  70 percent. 
D)  85 percent.

Question 16

If a country's population (age 16 and over) is 50 million, with 2 million unemployed and 23 million currently holding jobs, the

Accepted Answer

A)  unemployment rate is 4 percent, and the labor force participation rate is 46 percent. 
B)  unemployment rate is 8.0 percent, and the labor force participation rate is 50 percent. 
C)  unemployment rate is 4 percent, and the labor force participation rate is 50 percent. 
D)  unemployment rate is 8.7 percent, and the labor force participation rate 50 percent. 
A)  unemployment rate is 4 percent, and the labor force participation rate is 46 percent. 
B)  unemployment rate is 8.0 percent, and the labor force participation rate is 50 percent. 
C)  unemployment rate is 4 percent, and the labor force participation rate is 50 percent. 
D)  unemployment rate is 8.7 percent, and the labor force participation rate 50 percent.

Question 17

If Trevon voluntarily quits one job, possesses marketable skills, and expects to find a new job in a few weeks, then Trevon is considered

Accepted Answer

A)  frictionally unemployed. 
B)  cyclically unemployed. 
C)  seasonally unemployed. 
D)  structurally unemployed. 
E)  unwise to quit his job without already having another one. 
A)  frictionally unemployed. 
B)  cyclically unemployed. 
C)  seasonally unemployed. 
D)  structurally unemployed. 
E)  unwise to quit his job without already having another one.

Question 18

Answer the following questions:
a.Describe the three types of unemployment.
b.Explain why economists believe some types of unemployment are efficient and some are not. Which ones are which?

Accepted Answer

a.Frictional unemployment is unemploymen

Question 19

What is the natural rate of unemployment, and how does it relate to the concept of potential (or full-employment) GDP?

Accepted Answer

The natural rate of unemployment is the

Question 20

Which of the following will most likely cause a decrease the natural rate of unemployment?

Accepted Answer

A)  an increase in the minimum wage 
B)  an increase in unemployment benefits 
C)  an increase in experienced workers aged 25 and over as proportion of the labor force 
D)  an increase in the labor force participation rate of teenagers 
A)  an increase in the minimum wage 
B)  an increase in unemployment benefits 
C)  an increase in experienced workers aged 25 and over as proportion of the labor force 
D)  an increase in the labor force participation rate of teenagers

Which of the following about unemployment is true?

The natural rate of unemployment

The current U.S. unemployment insurance program

The unemployment rate is defined as the number of

Which of the following best explains why the rate of unemployment is highest among individuals aged 16 through 19?

The labor force participation rate is defined as the number of

Suppose an economy is operating at its maximum sustainable output rate. Neither recession nor economic boom are present. Which of the following would be true?

The natural rate of unemployment occurs if there is no

Terrell, an auto repair mechanic who remains unemployed because he refuses to work for less than $1,000 an hour, is

Which of the following types of unemployment can exist in an economy that is at its potential output level?

Suppose the population (age 16 and over) of Indonesia is 200 million; 9 million are unemployed, and 111 million hold jobs. Indicate the rate of unemployment and the employment/population ratio of Madagascar.

Which of the following will most likely reduce the natural rate of unemployment?

The unemployment rate will increase whenever there is

Suppose there are 25,000 employed and 5,000 unemployed persons. a.What is the unemployment rate? b.If 2,000 of those unemployed became discouraged and quit actively seeking work, what would happen to the unemployment rate? Calculate the new unemployment rate.

Suppose the population (age 16 and over) of Japan is 100 million; 5 million are unemployed, and 70 million hold jobs. The employment/population ratio of Guatemala is

If a country's population (age 16 and over) is 50 million, with 2 million unemployed and 23 million currently holding jobs, the

If Trevon voluntarily quits one job, possesses marketable skills, and expects to find a new job in a few weeks, then Trevon is considered

Answer the following questions: a.Describe the three types of unemployment. b.Explain why economists believe some types of unemployment are efficient and some are not. Which ones are which?

What is the natural rate of unemployment, and how does it relate to the concept of potential (or full-employment) GDP?

Which of the following will most likely cause a decrease the natural rate of unemployment?

The Economic Approach

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Taking the Nations Economic Pulse

An Introduction to Basic Macroeconomic Markets

Dynamic Change, Economic Fluctuations, and the Ad--As Model

Fiscal Policy: The Keynesian View and the Historical Development of Macroeconomics

Fiscal Policy: Incentives, and Secondary Effects

Money and the Banking System

Modern Macroeconomics and Monetary Policy

Stabilization Policy, Output, and Employment

Creating an Environment for Growth and Prosperity

Institutions, Policies, and Cross-Country Differences in Income and Growth

Gaining From International Trade

International Finance and the Foreign Exchange Market

Special Topics

Filters

Exam 8: Economic Fluctuations, Unemployment, and Inflation

Which of the following about unemployment is true?

The natural rate of unemployment

The current U.S. unemployment insurance program

The unemployment rate is defined as the number of

Which of the following best explains why the rate of unemployment is highest among individuals aged 16 through 19?

The labor force participation rate is defined as the number of

Suppose an economy is operating at its maximum sustainable output rate. Neither recession nor economic boom are present. Which of the following would be true?

The natural rate of unemployment occurs if there is no

Terrell, an auto repair mechanic who remains unemployed because he refuses to work for less than $1,000 an hour, is

Which of the following types of unemployment can exist in an economy that is at its potential output level?

Suppose the population (age 16 and over) of Indonesia is 200 million; 9 million are unemployed, and 111 million hold jobs. Indicate the rate of unemployment and the employment/population ratio of Madagascar.

Which of the following will most likely reduce the natural rate of unemployment?

The unemployment rate will increase whenever there is

Suppose there are 25,000 employed and 5,000 unemployed persons. a.What is the unemployment rate? b.If 2,000 of those unemployed became discouraged and quit actively seeking work, what would happen to the unemployment rate? Calculate the new unemployment rate.

Suppose the population (age 16 and over) of Japan is 100 million; 5 million are unemployed, and 70 million hold jobs. The employment/population ratio of Guatemala is

If a country's population (age 16 and over) is 50 million, with 2 million unemployed and 23 million currently holding jobs, the

If Trevon voluntarily quits one job, possesses marketable skills, and expects to find a new job in a few weeks, then Trevon is considered

Answer the following questions: a.Describe the three types of unemployment. b.Explain why economists believe some types of unemployment are efficient and some are not. Which ones are which?

What is the natural rate of unemployment, and how does it relate to the concept of potential (or full-employment) GDP?

Which of the following will most likely cause a decrease the natural rate of unemployment?

The Economic Approach

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Taking the Nations Economic Pulse

An Introduction to Basic Macroeconomic Markets

Dynamic Change, Economic Fluctuations, and the Ad--As Model

Fiscal Policy: The Keynesian View and the Historical Development of Macroeconomics

Fiscal Policy: Incentives, and Secondary Effects

Money and the Banking System

Modern Macroeconomics and Monetary Policy

Stabilization Policy, Output, and Employment

Creating an Environment for Growth and Prosperity

Institutions, Policies, and Cross-Country Differences in Income and Growth

Gaining From International Trade

International Finance and the Foreign Exchange Market

Special Topics

Filters