Question 1

Figure 28-2  
-Refer to Figure 28-2. If the minimum wage rose from $5 to $7, what would happen to unemployment?

Accepted Answer

A) It would rise by 40. 
B) It would rise by 20. 
C) It would fall by 20. 
D) It would fall by 40. 
A) It would rise by 40. 
B) It would rise by 20. 
C) It would fall by 20. 
D) It would fall by 40.

Question 2

In Sweden and Denmark, what percentage of the workers belong to unions?

Accepted Answer

A) almost zero 
B) about the same as in Canada 
C) a bit greater than in Canada 
D) much greater than in Canada 
A) almost zero 
B) about the same as in Canada 
C) a bit greater than in Canada 
D) much greater than in Canada

Question 3

How does Statistics Canada define the unemployment rate?

Accepted Answer

A) as the percentage of those unemployed relative to the percentage employed 
B) as the percentage of the labour force that is unemployed 
C) as the percentage of the adult population that is unemployed 
D) as the percentage of the labour force without full-time employment 
A) as the percentage of those unemployed relative to the percentage employed 
B) as the percentage of the labour force that is unemployed 
C) as the percentage of the adult population that is unemployed 
D) as the percentage of the labour force without full-time employment

Question 4

How is the unemployment rate reported by Statistics Canada likely to relate to the actual unemployment rate?

Accepted Answer

A) It is somewhat higher than the actual unemployment rate. 
B) It is somewhat lower than the actual unemployment rate. 
C) It is fairly close to the actual unemployment rate. 
D) It could be higher or lower than the actual unemployment rate. We cannot be certain. 
A) It is somewhat higher than the actual unemployment rate. 
B) It is somewhat lower than the actual unemployment rate. 
C) It is fairly close to the actual unemployment rate. 
D) It could be higher or lower than the actual unemployment rate. We cannot be certain.

Question 5

What impact would an increase in the minimum wage have on the quantity demanded and quantity supplied of labour?

Accepted Answer

A) It would increase both the quantity demanded and the quantity supplied of labour. 
B) It would decrease both the quantity demanded and the quantity supplied of labour. 
C) It would increase the quantity of labour demanded while decreasing the quantity supplied. 
D) It would decrease the quantity of labour demanded while increasing the quantity supplied. 
A) It would increase both the quantity demanded and the quantity supplied of labour. 
B) It would decrease both the quantity demanded and the quantity supplied of labour. 
C) It would increase the quantity of labour demanded while decreasing the quantity supplied. 
D) It would decrease the quantity of labour demanded while increasing the quantity supplied.

Question 6

How is a college student who is not working or looking for a job counted?

Accepted Answer

A) as neither employed nor part of the labour force 
B) as unemployed and in the labour force 
C) as unemployed, but not in the labour force 
D) as employed and in the labour force 
A) as neither employed nor part of the labour force 
B) as unemployed and in the labour force 
C) as unemployed, but not in the labour force 
D) as employed and in the labour force

Question 7

How do male and female groups compare based on unemployment rates in Canada?

Accepted Answer

A) Men have similar unemployment rates compared to women. 
B) Men have lower rates of unemployment than women. 
C) Men have higher rates of unemployment compared to women. 
D) It depends on the age group. 
A) Men have similar unemployment rates compared to women. 
B) Men have lower rates of unemployment than women. 
C) Men have higher rates of unemployment compared to women. 
D) It depends on the age group.

Question 8

(Challenging) Draw a firm's labour demand curve that intersects the vertical axis at $20 per hour, and choose a point on the curve corresponding to an hourly wage of $12 and employment of 50 workers.
a.Explain the significance of the labour demand curve and show why such a curve is downward sloping.
b.At the employment level of 50 workers, what is the total amount the employer pays in wages?
c.At the employment level of 50 workers, what is the firm's profit? (Hint: at each level of employment, the labour demand curve shows the maximum wage the firm is willing to pay an extra worker.).

Accepted Answer

a.When the market wage is high compared

Question 9

Since 1951, which of the following has happened to the labour-force participation rate of women?

Accepted Answer

A) It is impossible to tell if the labour-force participation rate of women has increased or decreased. 
B) It has increased, and they are now playing a more equal role in the economy. 
C) It has decreased, because they stay in school longer. 
D) It has decreased, because they now retire earlier. 
A) It is impossible to tell if the labour-force participation rate of women has increased or decreased. 
B) It has increased, and they are now playing a more equal role in the economy. 
C) It has decreased, because they stay in school longer. 
D) It has decreased, because they now retire earlier.

Question 10

According to most economists, which of the following would be an effect of eliminating unemployment insurance?

Accepted Answer

A) It would cause an increase in unemployment because people would quit jobs they thought were not secure. 
B) It would cause an increase in unemployment because if the government didn't provide unemployment insurance, private firms would offer superior insurance. 
C) It would cause a decrease in unemployment and an improvement in economic well-being. 
D) It would cause a decrease in unemployment, but economists disagree about whether economic well-being would be enhanced by such a change. 
A) It would cause an increase in unemployment because people would quit jobs they thought were not secure. 
B) It would cause an increase in unemployment because if the government didn't provide unemployment insurance, private firms would offer superior insurance. 
C) It would cause a decrease in unemployment and an improvement in economic well-being. 
D) It would cause a decrease in unemployment, but economists disagree about whether economic well-being would be enhanced by such a change.

Question 11

Sally is on a temporary layoff from the factory where she makes plastic tableware. If Sally participates in the Statistics Canada survey, how will she be classified?

Accepted Answer

A) as unemployed and in the labour force 
B) as unemployed and out of the labour force 
C) as employed and in the labour force 
D) as employed and out of the labour force 
A) as unemployed and in the labour force 
B) as unemployed and out of the labour force 
C) as employed and in the labour force 
D) as employed and out of the labour force

Question 12

In one year you meet 45 people who are each unemployed for one week, and five people who are each unemployed for the whole year. Which of the following statistics best describe this situation?

Accepted Answer

A) 90 percent are short-term unemployed, and 85.3 percent are long-term unemployed 
B) 10 percent are short-term unemployed, and 90 percent are long-term unemployed 
C) 90 percent are short-term unemployed, and 10 percent are long-term unemployed 
D) 88 percent are short-term unemployed, and 22 percent are long-term unemployed 
A) 90 percent are short-term unemployed, and 85.3 percent are long-term unemployed 
B) 10 percent are short-term unemployed, and 90 percent are long-term unemployed 
C) 90 percent are short-term unemployed, and 10 percent are long-term unemployed 
D) 88 percent are short-term unemployed, and 22 percent are long-term unemployed

Question 13

Which of the following is the effect of anything that makes the efficiency wage rise relative to the market-clearing wage on the quantities of labour demanded and supplied?

Accepted Answer

A) It increases both the quantity demanded and the quantity supplied of labour. 
B) It decreases both the quantity demanded and the quantity supplied of labour. 
C) It increases the quantity demanded and decreases the quantity supplied of labour. 
D) It decreases the quantity demanded and increases the quantity supplied of labour. 
A) It increases both the quantity demanded and the quantity supplied of labour. 
B) It decreases both the quantity demanded and the quantity supplied of labour. 
C) It increases the quantity demanded and decreases the quantity supplied of labour. 
D) It decreases the quantity demanded and increases the quantity supplied of labour.

Question 14

Which of the following will an efficient wage most likely do?

Accepted Answer

A) require increased turnover 
B) increase profitability 
C) help reduce the level of unemployment 
D) make the union stronger 
A) require increased turnover 
B) increase profitability 
C) help reduce the level of unemployment 
D) make the union stronger

Question 15

Which of the following people would be included in the labour force?

Accepted Answer

A) Holly, an unpaid homemaker 
B) Tiffany, a full-time student not looking for work 
C) Cody, who does not have a job, but is looking for work 
D) Kara, who has interrupted her carrier to raise her two children 
A) Holly, an unpaid homemaker 
B) Tiffany, a full-time student not looking for work 
C) Cody, who does not have a job, but is looking for work 
D) Kara, who has interrupted her carrier to raise her two children

Question 16

Is the reported unemployment rate statistic, as reported by Statistics Canada, reliable? If not, are there easy ways to improve it?

Accepted Answer

A) No, but there is no easy way to improve it. 
B) No, but there are several easy ways economists have identified to improve it. 
C) No, but there is one easy way of improving it. 
D) Yes, and there are several easy ways of improving it even more. 
A) No, but there is no easy way to improve it. 
B) No, but there are several easy ways economists have identified to improve it. 
C) No, but there is one easy way of improving it. 
D) Yes, and there are several easy ways of improving it even more.

Question 17

If the wage is kept above the equilibrium wage for any reason, the result is structural unemployment.

Accepted Answer

A) True 
 B)False

Question 18

Consider these facts: (1) Some people who are employed or who are not making a serious effort to find employment will report themselves as unemployed. (2) Some people who want to find work will be counted as out of the labour force. How do these facts affect the reported unemployment rate?

Accepted Answer

A) Both the first and the second facts tend to make the reported unemployment rate lower than the actual unemployment rate. 
B) Both the first and the second facts tend to make the reported unemployment rate higher than the actual unemployment rate. 
C) The first fact tends to make the reported unemployment rate higher than the actual unemployment rate. The second fact tends to make the reported unemployment rate lower than the actual rate. 
D) The first fact tends to make the reported unemployment rate lower than the actual unemployment rate. The second fact tends to make the reported unemployment rate higher than the actual rate. 
A) Both the first and the second facts tend to make the reported unemployment rate lower than the actual unemployment rate. 
B) Both the first and the second facts tend to make the reported unemployment rate higher than the actual unemployment rate. 
C) The first fact tends to make the reported unemployment rate higher than the actual unemployment rate. The second fact tends to make the reported unemployment rate lower than the actual rate. 
D) The first fact tends to make the reported unemployment rate lower than the actual unemployment rate. The second fact tends to make the reported unemployment rate higher than the actual rate.

Question 19

Regarding the categories of unemployment, how does a minimum wage law compare to firms paying higher-than-equilibrium wages?

Accepted Answer

A) The minimum wage creates frictional unemployment, while firms paying wages above equilibrium create structural unemployment. 
B) The minimum wage creates structural unemployment, while firms paying wages above equilibrium create frictional unemployment. 
C) The minimum wage and firms paying wages above equilibrium both create structural unemployment. 
D) The minimum wage and firms paying wages above equilibrium both create frictional unemployment. 
A) The minimum wage creates frictional unemployment, while firms paying wages above equilibrium create structural unemployment. 
B) The minimum wage creates structural unemployment, while firms paying wages above equilibrium create frictional unemployment. 
C) The minimum wage and firms paying wages above equilibrium both create structural unemployment. 
D) The minimum wage and firms paying wages above equilibrium both create frictional unemployment.

Question 20

Table 28-1. This table shows the 2007 data for males and females aged 15 and over in the country of Dan.
  
-Refer to Table 28-1.What is the adult male labour-force participation rate in Dan?

Accepted Answer

A) 7.40 percent 
B) 33.33 percent 
C) 37.03 percent 
D) 66.67 percent 
A) 7.40 percent 
B) 33.33 percent 
C) 37.03 percent 
D) 66.67 percent

Figure 28-2 -Refer to Figure 28-2. If the minimum wage rose from $5 to $7, what would happen to unemployment?

In Sweden and Denmark, what percentage of the workers belong to unions?

How does Statistics Canada define the unemployment rate?

How is the unemployment rate reported by Statistics Canada likely to relate to the actual unemployment rate?

What impact would an increase in the minimum wage have on the quantity demanded and quantity supplied of labour?

How is a college student who is not working or looking for a job counted?

How do male and female groups compare based on unemployment rates in Canada?

Since 1951, which of the following has happened to the labour-force participation rate of women?

According to most economists, which of the following would be an effect of eliminating unemployment insurance?

Sally is on a temporary layoff from the factory where she makes plastic tableware. If Sally participates in the Statistics Canada survey, how will she be classified?

In one year you meet 45 people who are each unemployed for one week, and five people who are each unemployed for the whole year. Which of the following statistics best describe this situation?

Which of the following is the effect of anything that makes the efficiency wage rise relative to the market-clearing wage on the quantities of labour demanded and supplied?

Which of the following will an efficient wage most likely do?

Which of the following people would be included in the labour force?

Is the reported unemployment rate statistic, as reported by Statistics Canada, reliable? If not, are there easy ways to improve it?

If the wage is kept above the equilibrium wage for any reason, the result is structural unemployment.

Consider these facts: (1) Some people who are employed or who are not making a serious effort to find employment will report themselves as unemployed. (2) Some people who want to find work will be counted as out of the labour force. How do these facts affect the reported unemployment rate?

Regarding the categories of unemployment, how does a minimum wage law compare to firms paying higher-than-equilibrium wages?

Table 28-1. This table shows the 2007 data for males and females aged 15 and over in the country of Dan. -Refer to Table 28-1.What is the adult male labour-force participation rate in Dan?

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 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

Five Debates Over Macroeconomic Policy

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Exam 9: Unemployment and Its Natural Rate

Figure 28-2 -Refer to Figure 28-2. If the minimum wage rose from $5 to $7, what would happen to unemployment?

In Sweden and Denmark, what percentage of the workers belong to unions?

How does Statistics Canada define the unemployment rate?

How is the unemployment rate reported by Statistics Canada likely to relate to the actual unemployment rate?

What impact would an increase in the minimum wage have on the quantity demanded and quantity supplied of labour?

How is a college student who is not working or looking for a job counted?

How do male and female groups compare based on unemployment rates in Canada?

Since 1951, which of the following has happened to the labour-force participation rate of women?

According to most economists, which of the following would be an effect of eliminating unemployment insurance?

Sally is on a temporary layoff from the factory where she makes plastic tableware. If Sally participates in the Statistics Canada survey, how will she be classified?

In one year you meet 45 people who are each unemployed for one week, and five people who are each unemployed for the whole year. Which of the following statistics best describe this situation?

Which of the following is the effect of anything that makes the efficiency wage rise relative to the market-clearing wage on the quantities of labour demanded and supplied?

Which of the following will an efficient wage most likely do?

Which of the following people would be included in the labour force?

Is the reported unemployment rate statistic, as reported by Statistics Canada, reliable? If not, are there easy ways to improve it?

If the wage is kept above the equilibrium wage for any reason, the result is structural unemployment.

Consider these facts: (1) Some people who are employed or who are not making a serious effort to find employment will report themselves as unemployed. (2) Some people who want to find work will be counted as out of the labour force. How do these facts affect the reported unemployment rate?

Regarding the categories of unemployment, how does a minimum wage law compare to firms paying higher-than-equilibrium wages?

Table 28-1. This table shows the 2007 data for males and females aged 15 and over in the country of Dan. -Refer to Table 28-1.What is the adult male labour-force participation rate in Dan?

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 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

Five Debates Over Macroeconomic Policy

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