Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Unemployment insurance reduces the incentive for the unemployed to find and take new jobs.

Accepted Answer

A) True 
 B)False

Question 3

Measuring unemployment is the job of the

Accepted Answer

A)  Congressional Budget Office. 
B)  Department of Commerce. 
C)  Council of Economic Advisers. 
D)  Bureau of Labor Statistics. 
A)  Congressional Budget Office. 
B)  Department of Commerce. 
C)  Council of Economic Advisers. 
D)  Bureau of Labor Statistics.

Question 4

Suppose that neither textile workers nor shoemakers are unionized.If textile workers unionize,then the supply of shoemakers will

Accepted Answer

A)  rise and their wages will rise. 
B)  rise and their wages will fall. 
C)  fall and their wages will fall. 
D)  fall and their wages will rise. 
A)  rise and their wages will rise. 
B)  rise and their wages will fall. 
C)  fall and their wages will fall. 
D)  fall and their wages will rise.

Question 5

Suppose some country had an adult population of about 25 million,a labor-force participation rate of 60 percent,and an unemployment rate of 6 percent.How many people were employed?

Accepted Answer

A)  0.9 million 
B)  14.1 million 
C)  15 million 
D)  23.5 million 
A)  0.9 million 
B)  14.1 million 
C)  15 million 
D)  23.5 million

Question 6

Sectoral shifts in demand for output

Accepted Answer

A)  create structural unemployment. 
B)  immediately reduce unemployment. 
C)  increase unemployment due to job search. 
D)  do not affect demand for labor. 
A)  create structural unemployment. 
B)  immediately reduce unemployment. 
C)  increase unemployment due to job search. 
D)  do not affect demand for labor.

Question 7

A firm might offer efficiency wages so its workers will eat a more nutritious diet and therefore be healthier and more productive.

Accepted Answer

A) True 
 B)False

Question 8

Table 28-1
Labor Data for Wrexington
  
-Refer to Table 28-1.The labor-force participation rate of Wrexington in 2006 was

Accepted Answer

A)  50%. 
B)  53.3%. 
C)  56.25%. 
D)  88.9%. 
A)  50%. 
B)  53.3%. 
C)  56.25%. 
D)  88.9%.

Question 9

Economists at the Congressional Budget Office estimated that for 2007,the U.S.natural rate of unemployment was 4.8 percent.

Accepted Answer

A) True 
 B)False

Question 10

In the 1940s and 1950s,about one-third of U.S.workers belonged to unions,but today,only about one-fifth of U.S.workers belong to unions.

Accepted Answer

A) True 
 B)False

Question 11

Suppose that butchers and bakers have no unions.Now suppose the butchers form a union.What does this do the labor supply of and wages of bakers?

Accepted Answer

A)  It increases the labor supply and wages of bakers. 
B)  It increases the labor supply and decreases the wages of bakers. 
C)  It decreases the labor supply and increases the wages of bakers. 
D)  It decreases the labor supply and wages of bakers. 
A)  It increases the labor supply and wages of bakers. 
B)  It increases the labor supply and decreases the wages of bakers. 
C)  It decreases the labor supply and increases the wages of bakers. 
D)  It decreases the labor supply and wages of bakers.

Question 12

People who report being unemployed but who,in fact,are not trying hard to find a job are really not in the labor force and therefore cause the reported unemployment rate to be higher than it would otherwise be.

Accepted Answer

A) True 
 B)False

Question 13

The theory of efficiency wages explains why

Accepted Answer

A)  setting wages at the equilibrium level may increase unemployment. 
B)  it may be in the best interest of firms to offer wages that are above the equilibrium level. 
C)  the most efficient way to pay workers is to pay them according to their skills. 
D)  it is efficient for firms to set wages at the equilibrium level. 
A)  setting wages at the equilibrium level may increase unemployment. 
B)  it may be in the best interest of firms to offer wages that are above the equilibrium level. 
C)  the most efficient way to pay workers is to pay them according to their skills. 
D)  it is efficient for firms to set wages at the equilibrium level.

Question 14

If the natural rate of unemployment is 5.2 percent and the actual rate of unemployment is 5.7 percent,then by definition there is

Accepted Answer

A)  cyclical unemployment amounting to 0.5 percent of the labor force. 
B)  frictional unemployment amounting to 0.5 percent of the labor force. 
C)  structural unemployment amounting to 0.5 percent of the labor force. 
D)  search unemployment amounting to 0.5 percent of the labor force. 
A)  cyclical unemployment amounting to 0.5 percent of the labor force. 
B)  frictional unemployment amounting to 0.5 percent of the labor force. 
C)  structural unemployment amounting to 0.5 percent of the labor force. 
D)  search unemployment amounting to 0.5 percent of the labor force.

Question 15

It is best to view the official unemployment rate as a useful but imperfect measure of joblessness.

Accepted Answer

A) True 
 B)False

Question 16

Within the U.S.population,teenagers have similar rates of unemployment as older workers.

Accepted Answer

A) True 
 B)False

Question 17

One reason economies always experience some unemployment is job search.

Accepted Answer

A) True 
 B)False

Question 18

The Bureau of Labor Statistics produces data on unemployment and other aspects of the labor market from a regular survey of about 600 households,called the Current Population Survey.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following was not among the four industries with the largest employment in the United States a century ago?

Accepted Answer

A)  cotton goods 
B)  men's clothing 
C)  corn 
D)  lumber 
A)  cotton goods 
B)  men's clothing 
C)  corn 
D)  lumber

Question 20

Within the U.S.population,teenagers have higher rates of unemployment than older workers.

Accepted Answer

A) True 
 B)False

Exam 28: Unemployment

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

Unemployment insurance reduces the incentive for the unemployed to find and take new jobs.

Measuring unemployment is the job of the

Suppose that neither textile workers nor shoemakers are unionized.If textile workers unionize,then the supply of shoemakers will

Suppose some country had an adult population of about 25 million,a labor-force participation rate of 60 percent,and an unemployment rate of 6 percent.How many people were employed?

Sectoral shifts in demand for output

A firm might offer efficiency wages so its workers will eat a more nutritious diet and therefore be healthier and more productive.

Table 28-1 Labor Data for Wrexington -Refer to Table 28-1.The labor-force participation rate of Wrexington in 2006 was

Economists at the Congressional Budget Office estimated that for 2007,the U.S.natural rate of unemployment was 4.8 percent.

In the 1940s and 1950s,about one-third of U.S.workers belonged to unions,but today,only about one-fifth of U.S.workers belong to unions.

Suppose that butchers and bakers have no unions.Now suppose the butchers form a union.What does this do the labor supply of and wages of bakers?

People who report being unemployed but who,in fact,are not trying hard to find a job are really not in the labor force and therefore cause the reported unemployment rate to be higher than it would otherwise be.

The theory of efficiency wages explains why

If the natural rate of unemployment is 5.2 percent and the actual rate of unemployment is 5.7 percent,then by definition there is

It is best to view the official unemployment rate as a useful but imperfect measure of joblessness.

Within the U.S.population,teenagers have similar rates of unemployment as older workers.

One reason economies always experience some unemployment is job search.

The Bureau of Labor Statistics produces data on unemployment and other aspects of the labor market from a regular survey of about 600 households,called the Current Population Survey.

Which of the following was not among the four industries with the largest employment in the United States a century ago?

Within the U.S.population,teenagers have higher rates of unemployment than older workers.

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

Application: 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 of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, investment, and the Financial System

The Basic 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 Trade-Off Between Inflation and Unemployment

Five Debates Over Macroeconomic Policy

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