Question 1

Who would NOT be included in the labour force?

Accepted Answer

A)  Karen,who works most of the week in a steel factory 
B)  Beth,who is waiting for her new job at the bank to start 
C)  Dave,who does not have a job,but is looking for work 
D)  Jeremiah,who plans to travel for a few months before looking for work 
A)  Karen,who works most of the week in a steel factory 
B)  Beth,who is waiting for her new job at the bank to start 
C)  Dave,who does not have a job,but is looking for work 
D)  Jeremiah,who plans to travel for a few months before looking for work

Question 2

The City of Burnaby,B.C.,would like to assess the impact of next year's immigration on the labour market for taxi driving.Suppose the city estimates the demand and supply equations for taxi drivers as follows: LD = 400 ?2- 20w and LS = 60 + 20w.Based on immigration data,the city estimates that about 60 new drivers will enter the taxi driving sector next year.At the same time,immigration increases the demand for taxi services,but only for about 40 new drivers.
a)Calculate the equilibrium wage and employment in the labour market for taxi driving in Burnaby,B.C.,before the new wave of immigration.
b)Re-calculate the equilibrium wage and employment after immigration.
c)How many workers leave the labour force in the taxi driving sector after the new equilibrium would have been reached? Are these locals,or immigrants?
d)Draw a graph to show the effect of immigration.

Accepted Answer

a)Before immigration,the equilibrium wag

Question 3

What is the effect of unions on wages and employment?

Accepted Answer

A)  Unions are unlikely to affect wages and employment. 
B)  Unions raise wages above the competitive equilibrium level. 
C)  Unions increase the level of employment in unionized firms. 
D)  Unions decrease the level of employment in nonunionized firms. 
A)  Unions are unlikely to affect wages and employment. 
B)  Unions raise wages above the competitive equilibrium level. 
C)  Unions increase the level of employment in unionized firms. 
D)  Unions decrease the level of employment in nonunionized firms.

Question 4

In one year you meet 40 people who are each unemployed for one week,and 10 people who are each unemployed for the whole year.Which statistic best describes this situation?

Accepted Answer

A)  80 percent are short-term unemployed,and 25.3 percent are long-term unemployed. 
B)  20 percent are short-term unemployed,and 80 percent are long-term unemployed. 
C)  80 percent are short-term unemployed,and 20 percent are long-term unemployed. 
D)  75 percent are short-term unemployed,and 25 percent are long-term unemployed. 
A)  80 percent are short-term unemployed,and 25.3 percent are long-term unemployed. 
B)  20 percent are short-term unemployed,and 80 percent are long-term unemployed. 
C)  80 percent are short-term unemployed,and 20 percent are long-term unemployed. 
D)  75 percent are short-term unemployed,and 25 percent are long-term unemployed.

Question 5

How are discouraged workers counted in unemployment statistics?

Accepted Answer

A)  They are not counted either as part of the adult population or as part of the labour force. 
B)  They are counted as part of the adult population,but not as part of the labour force. 
C)  They are counted as part of the adult population and as unemployed. 
D)  They are counted as unemployed,but not part of labour force. 
A)  They are not counted either as part of the adult population or as part of the labour force. 
B)  They are counted as part of the adult population,but not as part of the labour force. 
C)  They are counted as part of the adult population and as unemployed. 
D)  They are counted as unemployed,but not part of labour force.

Question 6

What is cyclical unemployment closely associated with?

Accepted Answer

A)  long-term economic growth 
B)  short-run ups and downs of the economy 
C)  fluctuations in the natural rate of unemployment 
D)  seasonal fluctuations in spending 
A)  long-term economic growth 
B)  short-run ups and downs of the economy 
C)  fluctuations in the natural rate of unemployment 
D)  seasonal fluctuations in spending

Question 7

Which of the following best defines the labour force?

Accepted Answer

A)  the number of employed 
B)  the population minus the number of unemployed 
C)  the population aged 15 or over 
D)  the number of unemployed plus the number of employed 
A)  the number of employed 
B)  the population minus the number of unemployed 
C)  the population aged 15 or over 
D)  the number of unemployed plus the number of employed

Question 8

Aaron is the owner of a firm that produces wind power in southern Alberta.There are many such firms in the area.Aaron decides that if he pays his workers a wage higher than the going market wage,his profits will increase.What is a likely explanation for his decision?

Accepted Answer

A)  The higher the wage,the less often his workers will choose to leave his firm. 
B)  The higher the wage,the lower will be the cost of obtaining needed supplies. 
C)  The higher the wage,the more he can charge for his wind power. 
D)  The higher the wage,the less competition will be in the industry. 
A)  The higher the wage,the less often his workers will choose to leave his firm. 
B)  The higher the wage,the lower will be the cost of obtaining needed supplies. 
C)  The higher the wage,the more he can charge for his wind power. 
D)  The higher the wage,the less competition will be in the industry.

Question 9

How does the labour-force participation rate of women just after World War II compare to the same statistic today?

Accepted Answer

A)  Today,labour-force participation rate of women is about 1.5 times the rate after World War II. 
B)  Today,labour-force participation rate of women is about 2.6 times the rate after World War II. 
C)  Today,labour-force participation rate of women is about 3.6 times the rate after World War II. 
D)  Today,labour-force participation rate of women is about 4.2 times the rate after World War II. 
A)  Today,labour-force participation rate of women is about 1.5 times the rate after World War II. 
B)  Today,labour-force participation rate of women is about 2.6 times the rate after World War II. 
C)  Today,labour-force participation rate of women is about 3.6 times the rate after World War II. 
D)  Today,labour-force participation rate of women is about 4.2 times the rate after World War II.

Question 10

Suppose the summer labour market for construction workers in the city of Red Deer is described by the equations LD = 500 - 10w and LS = -100 + 10w,where L is the number of workers and w is hourly wage.
a)Draw the labour supply and demand curves.
b)Find the equilibrium wage and employment.
c)How much is the unemployment rate in equilibrium?
d)Suppose that 50 less workers are needed in winter in equilibrium compared to the summer equilibrium employment.Calculate the winter equilibrium wage,and show in a graph the winter labour market model compared to the summer one.

Accepted Answer

a)The following figure shows the labour

Question 11

Which statement best defines collective bargaining?

Accepted Answer

A)  It is the process by which the government sets exemptions from the minimum-wage law. 
B)  It is setting the same wage for all employees to prevent jealousy among workers. 
C)  It is the situation when firms collude to set the wages of employees in order to keep them below equilibrium. 
D)  It is the process by which unions and firms agree on the terms of employment. 
A)  It is the process by which the government sets exemptions from the minimum-wage law. 
B)  It is setting the same wage for all employees to prevent jealousy among workers. 
C)  It is the situation when firms collude to set the wages of employees in order to keep them below equilibrium. 
D)  It is the process by which unions and firms agree on the terms of employment.

Question 12

What is most likely to cause frictional unemployment?

Accepted Answer

A)  workers leaving the labour force 
B)  an economy in recession 
C)  an increase in population 
D)  changes in the composition of demand among industries or regions 
A)  workers leaving the labour force 
B)  an economy in recession 
C)  an increase in population 
D)  changes in the composition of demand among industries or regions

Question 13

What might increase the natural rate of unemployment?

Accepted Answer

A)  an increased access to the Internet 
B)  a natural increase in population 
C)  an aging population 
D)  an increase in the legal retirement age 
A)  an increased access to the Internet 
B)  a natural increase in population 
C)  an aging population 
D)  an increase in the legal retirement age

Question 14

Over half of the unemployed are recent entrants into the labour force.

Accepted Answer

A) True 
 B)False

Question 15

According to economists,how should the reported unemployment rate be viewed?

Accepted Answer

A)  as a useful but imperfect measure of joblessness 
B)  as clearly smaller than the true unemployment rate 
C)  as clearly larger than the true unemployment rate 
D)  as being very close to the true unemployment rate 
A)  as a useful but imperfect measure of joblessness 
B)  as clearly smaller than the true unemployment rate 
C)  as clearly larger than the true unemployment rate 
D)  as being very close to the true unemployment rate

Question 16

In 2014 in the United Kingdom,the adult population was about 65 million,the labour force participation rate was 62percent,and the unemployment rate was 5.7 percent.What was the number of people unemployed?

Accepted Answer

A)  0.7 million 
B)  1.7 million 
C)  2.3 million 
D)  6.5 million 
A)  0.7 million 
B)  1.7 million 
C)  2.3 million 
D)  6.5 million

Question 17

Which statement best explains how unemployment relates to business cycles?

Accepted Answer

A)  Unemployment can be eliminated through economic policies when the economy grows at normal rates. 
B)  Unemployment only exists during periods of economic slowdown. 
C)  Cyclical unemployment is inversely related to short-run economic fluctuations. 
D)  Unemployment is unrelated to short-run economic fluctuations. 
A)  Unemployment can be eliminated through economic policies when the economy grows at normal rates. 
B)  Unemployment only exists during periods of economic slowdown. 
C)  Cyclical unemployment is inversely related to short-run economic fluctuations. 
D)  Unemployment is unrelated to short-run economic fluctuations.

Question 18

In Canada,what fraction of the unemployed are recent entrants into the labour force?

Accepted Answer

A)  about 1 / 6 of those who are unemployed 
B)  about 1 / 5 of those who are unemployed 
C)  about 1 / 4 of those who are unemployed 
D)  about 1 / 3 of those who are unemployed 
A)  about 1 / 6 of those who are unemployed 
B)  about 1 / 5 of those who are unemployed 
C)  about 1 / 4 of those who are unemployed 
D)  about 1 / 3 of those who are unemployed

Question 19

Cyclical unemployment and the natural rate of unemployment are sometimes hard to distinguish from each other,so economists are not very confident about estimates of the natural rate of unemployment.Still,since unemployment rates are consistently higher in Canada and most Western European countries than in the United States,it appears that the natural rate of unemployment is lower in the United States.What might explain this difference?

Accepted Answer

The text offers two explanations for the

Question 20

What does the labour-force participation rate measure?

Accepted Answer

A)  the percentage of the total adult population that is in the labour force 
B)  the percentage of the total adult population that is employed 
C)  the percentage of the labour force that is employed 
D)  the percentage of the labour force that is either employed or unemployed 
A)  the percentage of the total adult population that is in the labour force 
B)  the percentage of the total adult population that is employed 
C)  the percentage of the labour force that is employed 
D)  the percentage of the labour force that is either employed or unemployed

Who would NOT be included in the labour force?

What is the effect of unions on wages and employment?

In one year you meet 40 people who are each unemployed for one week,and 10 people who are each unemployed for the whole year.Which statistic best describes this situation?

How are discouraged workers counted in unemployment statistics?

What is cyclical unemployment closely associated with?

Which of the following best defines the labour force?

Aaron is the owner of a firm that produces wind power in southern Alberta.There are many such firms in the area.Aaron decides that if he pays his workers a wage higher than the going market wage,his profits will increase.What is a likely explanation for his decision?

How does the labour-force participation rate of women just after World War II compare to the same statistic today?

Which statement best defines collective bargaining?

What is most likely to cause frictional unemployment?

What might increase the natural rate of unemployment?

Over half of the unemployed are recent entrants into the labour force.

According to economists,how should the reported unemployment rate be viewed?

In 2014 in the United Kingdom,the adult population was about 65 million,the labour force participation rate was 62percent,and the unemployment rate was 5.7 percent.What was the number of people unemployed?

Which statement best explains how unemployment relates to business cycles?

In Canada,what fraction of the unemployed are recent entrants into the labour force?

What does the labour-force participation rate measure?

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 Small 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

Who would NOT be included in the labour force?

What is the effect of unions on wages and employment?

In one year you meet 40 people who are each unemployed for one week,and 10 people who are each unemployed for the whole year.Which statistic best describes this situation?

How are discouraged workers counted in unemployment statistics?

What is cyclical unemployment closely associated with?

Which of the following best defines the labour force?

Aaron is the owner of a firm that produces wind power in southern Alberta.There are many such firms in the area.Aaron decides that if he pays his workers a wage higher than the going market wage,his profits will increase.What is a likely explanation for his decision?

How does the labour-force participation rate of women just after World War II compare to the same statistic today?

Which statement best defines collective bargaining?

What is most likely to cause frictional unemployment?

What might increase the natural rate of unemployment?

Over half of the unemployed are recent entrants into the labour force.

According to economists,how should the reported unemployment rate be viewed?

In 2014 in the United Kingdom,the adult population was about 65 million,the labour force participation rate was 62percent,and the unemployment rate was 5.7 percent.What was the number of people unemployed?

Which statement best explains how unemployment relates to business cycles?

In Canada,what fraction of the unemployed are recent entrants into the labour force?

What does the labour-force participation rate measure?

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 Small 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

Filters