Question 1

What is the best description of unemployment insurance benefits in the United States?

Accepted Answer

A) All unemployed workers receive the same benefit regardless of what their previous job was. 
B) All unemployed workers receive the same wage-adjusted benefit regardless of what state they live in. 
C) Unemployment benefits are based on family size and age. 
D) Unemployment benefits are greater for low-wage workers than for high-wage workers. 
E) Unemployment benefits are a greater percentage of previous earnings for low-wage workers than for high-wage workers. 
A) All unemployed workers receive the same benefit regardless of what their previous job was. 
B) All unemployed workers receive the same wage-adjusted benefit regardless of what state they live in. 
C) Unemployment benefits are based on family size and age. 
D) Unemployment benefits are greater for low-wage workers than for high-wage workers. 
E) Unemployment benefits are a greater percentage of previous earnings for low-wage workers than for high-wage workers. E

Question 2

In the United States, the average replacement ratio associated with unemployment insurance benefits is

Accepted Answer

A) 10% 
B) 35% 
C) 50% 
D) 80% 
E) 100% 
A) 10% 
B) 35% 
C) 50% 
D) 80% 
E) 100% B

Question 3

Since 1980, unemployment rates have been _________ in Europe relative to in United States.

Accepted Answer

A) higher 
B) lower 
C) about the same 
D) unpredictable 
E) adjusting 
A) higher 
B) lower 
C) about the same 
D) unpredictable 
E) adjusting A

Question 4

If the seasonally unemployed no longer qualified for unemployment insurance benefits, then we would expect

Accepted Answer

A) no seasonal unemployment. 
B) no seasonal workers. 
C) higher wages for seasonal workers. 
D) lower wages for seasonal workers. 
E) greater UI benefits paid to non-seasonal workers. 
A) no seasonal unemployment. 
B) no seasonal workers. 
C) higher wages for seasonal workers. 
D) lower wages for seasonal workers. 
E) greater UI benefits paid to non-seasonal workers.

Question 5

Centerville has 200 unemployed people.Of these 200 people, 35 are unemployed for two weeks before finding a new job, 55 are unemployed for four weeks before finding a new job, 30 are unemployed for six weeks before finding a new job, 15 are unemployed for ten weeks before finding a new job, and 65 are unemployed for fifteen weeks before finding a new job.Approximately what is the average spell of unemployment in Centerville?

Accepted Answer

A) 2 weeks 
B) 5 weeks 
C) 8 weeks 
D) 11 weeks 
E) 14 weeks 
A) 2 weeks 
B) 5 weeks 
C) 8 weeks 
D) 11 weeks 
E) 14 weeks

Question 6

In the United States from 1950 to 2005, it is most likely that an unemployed person will

Accepted Answer

A) be re-employed in less than 5 weeks. 
B) be re-employed in 5 to 14 weeks. 
C) be re-employed in 14 to 26 weeks. 
D) be re-employed in more than 26 weeks. 
E) exit the labor force. 
A) be re-employed in less than 5 weeks. 
B) be re-employed in 5 to 14 weeks. 
C) be re-employed in 14 to 26 weeks. 
D) be re-employed in more than 26 weeks. 
E) exit the labor force.

Question 7

If the steady-state unemployment rate for an economy is 5%, and each period 2% of employed workers lose their jobs, what percent of unemployed workers find employment each period?

Accepted Answer

A) 8% 
B) 18% 
C) 28% 
D) 38% 
E) 48% 
A) 8% 
B) 18% 
C) 28% 
D) 38% 
E) 48%

Question 8

How does the asking wage depend on the unemployment insurance system in the United States?

Accepted Answer

A) The asking wage is constant regardless of the unemployment insurance system. 
B) The asking wage will fall as the unemployed worker gets closer to exhausting his or her UI benefits. 
C) The asking wage is lower while receiving UI benefits than it is when not receiving UI benefits. 
D) The asking wage is lower the more likely it is to receive a job offer. 
E) The asking wage is lower the more skills the unemployed worker has. 
A) The asking wage is constant regardless of the unemployment insurance system. 
B) The asking wage will fall as the unemployed worker gets closer to exhausting his or her UI benefits. 
C) The asking wage is lower while receiving UI benefits than it is when not receiving UI benefits. 
D) The asking wage is lower the more likely it is to receive a job offer. 
E) The asking wage is lower the more skills the unemployed worker has.

Question 9

The short-run Phillips curve is __________, while the long-run Phillips curve is vertical at the __________.

Accepted Answer

A) downward sloping; real wage 
B) downward sloping; natural rate of unemployment 
C) upward sloping; minimum wage 
D) upward sloping; average nominal wage rate 
E) horizontal; origin 
A) downward sloping; real wage 
B) downward sloping; natural rate of unemployment 
C) upward sloping; minimum wage 
D) upward sloping; average nominal wage rate 
E) horizontal; origin

Question 10

What best describes unemployment spells in the United States?

Accepted Answer

A) Most spells of unemployment are rather short, and therefore most weeks of unemployment can be attributed to these short spells. 
B) Most spells of unemployment are rather short, but most weeks of unemployment are attributed to very long spells. 
C) Most spells of unemployment are rather long, and therefore most weeks of unemployment can be attributed to these long spells. 
D) Most spells of unemployment are rather long, but most weeks of unemployment are attributed to short spells. 
E) Most spells of structural unemployment are much shorter than most spells associated with frictional unemployment, but how these two interact to determine the average length of an unemployment spell is unknown. 
A) Most spells of unemployment are rather short, and therefore most weeks of unemployment can be attributed to these short spells. 
B) Most spells of unemployment are rather short, but most weeks of unemployment are attributed to very long spells. 
C) Most spells of unemployment are rather long, and therefore most weeks of unemployment can be attributed to these long spells. 
D) Most spells of unemployment are rather long, but most weeks of unemployment are attributed to short spells. 
E) Most spells of structural unemployment are much shorter than most spells associated with frictional unemployment, but how these two interact to determine the average length of an unemployment spell is unknown.

Question 11

Which is not a likely explanation as to why unemployment rates are higher in Europe than in the United States?

Accepted Answer

A) Most European countries offer more generous unemployment insurance benefits than in the United States. 
B) Most European countries have stronger employment protection restrictions than in the United States. 
C) There is more wage rigidity in Europe than in the United States. 
D) Europeans are less productive than Americans. 
E) Most European countries offer unemployment benefits for longer than they are available in the United States. 
A) Most European countries offer more generous unemployment insurance benefits than in the United States. 
B) Most European countries have stronger employment protection restrictions than in the United States. 
C) There is more wage rigidity in Europe than in the United States. 
D) Europeans are less productive than Americans. 
E) Most European countries offer unemployment benefits for longer than they are available in the United States.

Question 12

Why is frictional unemployment considered to be productive?

Accepted Answer

A) Search activities of workers and firms resulting in frictional unemployment improve the allocation of resources. 
B) Firms do not hire a worker until they find the most educated worker. 
C) There are more potential workers seeking jobs than there are jobs for workers when there is frictional unemployment. 
D) The demand for highly-skilled workers exceeds the supply of highly-skilled workers when there is frictional unemployment. 
E) Frictional unemployment leads to a decrease in the unemployment rate. 
A) Search activities of workers and firms resulting in frictional unemployment improve the allocation of resources. 
B) Firms do not hire a worker until they find the most educated worker. 
C) There are more potential workers seeking jobs than there are jobs for workers when there is frictional unemployment. 
D) The demand for highly-skilled workers exceeds the supply of highly-skilled workers when there is frictional unemployment. 
E) Frictional unemployment leads to a decrease in the unemployment rate.

Question 13

James is currently unemployed.He is disappointed every Sunday when none of the job advertisements in the newspaper are for workers with his particular skill set.What type of unemployment is James experiencing?

Accepted Answer

A) Frictional unemployment 
B) Seasonal unemployment 
C) Cyclical unemployment 
D) Structural unemployment 
E) Natural unemployment 
A) Frictional unemployment 
B) Seasonal unemployment 
C) Cyclical unemployment 
D) Structural unemployment 
E) Natural unemployment

Question 14

Compared to offering no unemployment benefits, the unemployment insurance system of the United States probably

Accepted Answer

A) leads to shorter spells of unemployment. 
B) increases the unemployment rate. 
C) leads to lower post-unemployment wages. 
D) provides for a lower standard of living while unemployed. 
E) is less costly for firms. 
A) leads to shorter spells of unemployment. 
B) increases the unemployment rate. 
C) leads to lower post-unemployment wages. 
D) provides for a lower standard of living while unemployed. 
E) is less costly for firms.

Question 15

The likelihood of experiencing a spell of unemployment lasting at least 12 months

Accepted Answer

A) is roughly the same in the United States as it is in Europe. 
B) is much lower in the United States than in Europe. 
C) is much higher in Europe than in the United States with all European countries having at least 30% of their unemployed experiencing a spell of unemployment of at least 12 months. 
D) varies substantially across European countries, with some rivaling the United States but many others being much higher than the U.S. 
E) varies substantially across European countries, with some rivaling the United States but many others being much lower than the U.S. 
A) is roughly the same in the United States as it is in Europe. 
B) is much lower in the United States than in Europe. 
C) is much higher in Europe than in the United States with all European countries having at least 30% of their unemployed experiencing a spell of unemployment of at least 12 months. 
D) varies substantially across European countries, with some rivaling the United States but many others being much higher than the U.S. 
E) varies substantially across European countries, with some rivaling the United States but many others being much lower than the U.S.

Question 16

What is the general relationship between race and unemployment rates in the United States?

Accepted Answer

A) Whites have the lowest rate of unemployment; Hispanics have the highest rate of unemployment. 
B) Whites have the lowest rate of unemployment; blacks have the highest rate of unemployment. 
C) Hispanics have the lowest rate of unemployment; whites have the highest rate of unemployment. 
D) Hispanics have the lowest rate of unemployment; blacks have the highest rate of unemployment. 
E) Blacks have the lowest rate of unemployment; Hispanics have the highest rate of unemployment. 
A) Whites have the lowest rate of unemployment; Hispanics have the highest rate of unemployment. 
B) Whites have the lowest rate of unemployment; blacks have the highest rate of unemployment. 
C) Hispanics have the lowest rate of unemployment; whites have the highest rate of unemployment. 
D) Hispanics have the lowest rate of unemployment; blacks have the highest rate of unemployment. 
E) Blacks have the lowest rate of unemployment; Hispanics have the highest rate of unemployment.

Question 17

Consider an economy with a labor force of 100 million people.Each period, 60% of the unemployed population find a job while 15% of the employed population lose their job.What is the steady-state unemployment rate in the economy?

Accepted Answer

A) 5% 
B) 10% 
C) 15% 
D) 20% 
E) 60% 
A) 5% 
B) 10% 
C) 15% 
D) 20% 
E) 60%

Question 18

Which of the following would not increase the asking wage?

Accepted Answer

A) The government expands UI benefits from 26 to 52 weeks. 
B) The government increases the maximum weekly unemployment benefit from $500 to $800. 
C) An increase in the unemployment rate. 
D) Having one's spouse receive a pay raise. 
E) The government stops taxing UI benefits. 
A) The government expands UI benefits from 26 to 52 weeks. 
B) The government increases the maximum weekly unemployment benefit from $500 to $800. 
C) An increase in the unemployment rate. 
D) Having one's spouse receive a pay raise. 
E) The government stops taxing UI benefits.

Question 19

The natural rate of unemployment is higher in many European countries than in the United States largely because

Accepted Answer

A) European countries tend to offer more generous unemployment benefits than in the United States. 
B) European countries tend to place fewer conditions on employers regarding working conditions and firing workers than in the United States. 
C) the labor force is smaller in European countries than in the United States. 
D) more European workers are paid an annual salary rather than an hourly wage compared to workers in the United States. 
E) many European countries have recently targeted policies to fight hyperinflation rather than worrying about unemployment. 
A) European countries tend to offer more generous unemployment benefits than in the United States. 
B) European countries tend to place fewer conditions on employers regarding working conditions and firing workers than in the United States. 
C) the labor force is smaller in European countries than in the United States. 
D) more European workers are paid an annual salary rather than an hourly wage compared to workers in the United States. 
E) many European countries have recently targeted policies to fight hyperinflation rather than worrying about unemployment.

Question 20

Which age group experiences the highest rates of unemployment in the United States?

Accepted Answer

A) 16 to 24 years-old. 
B) 25 to 34 years-old. 
C) 35 to 44 years-old. 
D) 45 to 54 years-old. 
E) 55 to 64 years-old. 
A) 16 to 24 years-old. 
B) 25 to 34 years-old. 
C) 35 to 44 years-old. 
D) 45 to 54 years-old. 
E) 55 to 64 years-old.

What is the best description of unemployment insurance benefits in the United States?

In the United States, the average replacement ratio associated with unemployment insurance benefits is

Since 1980, unemployment rates have been _________ in Europe relative to in United States.

If the seasonally unemployed no longer qualified for unemployment insurance benefits, then we would expect

In the United States from 1950 to 2005, it is most likely that an unemployed person will

If the steady-state unemployment rate for an economy is 5%, and each period 2% of employed workers lose their jobs, what percent of unemployed workers find employment each period?

How does the asking wage depend on the unemployment insurance system in the United States?

The short-run Phillips curve is , while the long-run Phillips curve is vertical at the .

What best describes unemployment spells in the United States?

Which is not a likely explanation as to why unemployment rates are higher in Europe than in the United States?

Why is frictional unemployment considered to be productive?

James is currently unemployed.He is disappointed every Sunday when none of the job advertisements in the newspaper are for workers with his particular skill set.What type of unemployment is James experiencing?

Compared to offering no unemployment benefits, the unemployment insurance system of the United States probably

The likelihood of experiencing a spell of unemployment lasting at least 12 months

What is the general relationship between race and unemployment rates in the United States?

Consider an economy with a labor force of 100 million people.Each period, 60% of the unemployed population find a job while 15% of the employed population lose their job.What is the steady-state unemployment rate in the economy?

Which of the following would not increase the asking wage?

The natural rate of unemployment is higher in many European countries than in the United States largely because

Which age group experiences the highest rates of unemployment in the United States?

Introduction to Labor Economics

Labor Supply

Labor Demand

Labor Market Equilibrium

Compensating Wage Differentials

Human Capital

The Wage Structure

Labor Mobility

Labor Market Discrimination

Labor Unions

Incentive Pay

Filters

Exam 12: Unemployment

What is the best description of unemployment insurance benefits in the United States?

In the United States, the average replacement ratio associated with unemployment insurance benefits is

Since 1980, unemployment rates have been _________ in Europe relative to in United States.

If the seasonally unemployed no longer qualified for unemployment insurance benefits, then we would expect

In the United States from 1950 to 2005, it is most likely that an unemployed person will

If the steady-state unemployment rate for an economy is 5%, and each period 2% of employed workers lose their jobs, what percent of unemployed workers find employment each period?

How does the asking wage depend on the unemployment insurance system in the United States?

The short-run Phillips curve is __________, while the long-run Phillips curve is vertical at the __________.

What best describes unemployment spells in the United States?

Which is not a likely explanation as to why unemployment rates are higher in Europe than in the United States?

Why is frictional unemployment considered to be productive?

James is currently unemployed.He is disappointed every Sunday when none of the job advertisements in the newspaper are for workers with his particular skill set.What type of unemployment is James experiencing?

Compared to offering no unemployment benefits, the unemployment insurance system of the United States probably

The likelihood of experiencing a spell of unemployment lasting at least 12 months

What is the general relationship between race and unemployment rates in the United States?

Consider an economy with a labor force of 100 million people.Each period, 60% of the unemployed population find a job while 15% of the employed population lose their job.What is the steady-state unemployment rate in the economy?

Which of the following would not increase the asking wage?

The natural rate of unemployment is higher in many European countries than in the United States largely because

Which age group experiences the highest rates of unemployment in the United States?

Introduction to Labor Economics

Labor Supply

Labor Demand

Labor Market Equilibrium

Compensating Wage Differentials

Human Capital

The Wage Structure

Labor Mobility

Labor Market Discrimination

Labor Unions

Incentive Pay

Filters

The short-run Phillips curve is , while the long-run Phillips curve is vertical at the .