Question 1

The amount of unemployment that an economy normally experiences is called the

Accepted Answer

A)  average rate of unemployment. 
B)  natural rate of unemployment. 
C)  cyclical rate of unemployment. 
D)  typical rate of unemployment. 
A)  average rate of unemployment. 
B)  natural rate of unemployment. 
C)  cyclical rate of unemployment. 
D)  typical rate of unemployment.

Question 2

The unemployment that results from the quantity of labor supplied exceeding the quantity demanded is called frictional unemployment.

Accepted Answer

A) True 
 B)False

Question 3

Wages in excess of their equilibrium level help explain

Accepted Answer

A)  structural unemployment but not the natural rate of unemployment. 
B)  the natural rate of unemployment but not structural unemployment. 
C)  both structural unemployment and the natural rate of unemployment. 
D)  neither structural unemployment nor the natural rate of unemployment. 
A)  structural unemployment but not the natural rate of unemployment. 
B)  the natural rate of unemployment but not structural unemployment. 
C)  both structural unemployment and the natural rate of unemployment. 
D)  neither structural unemployment nor the natural rate of unemployment.

Question 4

Unemployment insurance is designed to offer workers full protection against job loss.

Accepted Answer

A) True 
 B)False

Question 5

Buddy is the owner of a firm that bottles beer in St. Louis, Missouri. There are many other such firms in the area. Buddy decides that if he pays his workers a wage higher than the going market wage, his profits will increase. Which of the following 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 costs of obtaining needed supplies. 
C)  The higher the wage, the more he can charge for his beer 
D)  The higher the wage, the more he will have to monitor his workers for shirking. 
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 costs of obtaining needed supplies. 
C)  The higher the wage, the more he can charge for his beer 
D)  The higher the wage, the more he will have to monitor his workers for shirking.

Question 6

Adults who were waiting to be recalled to a job from which they had been laid off are included in the Bureau of Labor Statistics' "employed" category.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is not correct?

Accepted Answer

A)  A union is a worker association that bargains with employers over wages, benefits, and working conditions. 
B)  Unions play a much larger role in the U.S. labor market now than they did in the past. 
C)  Unions play a large role in many European countries. 
D)  A union is a type of cartel. 
A)  A union is a worker association that bargains with employers over wages, benefits, and working conditions. 
B)  Unions play a much larger role in the U.S. labor market now than they did in the past. 
C)  Unions play a large role in many European countries. 
D)  A union is a type of cartel.

Question 8

The Bureau of Labor Statistics' U­1 measure of joblessness is smaller than its U­6 measure of joblessness.

Accepted Answer

A) True 
 B)False

Question 9

Figure 28-5  
-Refer to Figure 28-5. If the minimum wage is set at $125, then

Accepted Answer

A)  the quantity of labor demanded will equal 20. 
B)  the quantity of labor supplied will equal 35. 
C)  the surplus of labor will equal 25. 
D)  unemployment will equal 10. 
A)  the quantity of labor demanded will equal 20. 
B)  the quantity of labor supplied will equal 35. 
C)  the surplus of labor will equal 25. 
D)  unemployment will equal 10.

Question 10

Policies that reduce the time it takes unemployed workers to find new jobs

Accepted Answer

A)  can reduce both frictional unemployment and the natural rate of unemployment. 
B)  can reduce frictional unemployment, but they cannot reduce the natural rate of unemployment. 
C)  cannot reduce frictional unemployment, but they can reduce the natural rate of unemployment. 
D)  cannot reduce either frictional unemployment or the natural rate of unemployment. 
A)  can reduce both frictional unemployment and the natural rate of unemployment. 
B)  can reduce frictional unemployment, but they cannot reduce the natural rate of unemployment. 
C)  cannot reduce frictional unemployment, but they can reduce the natural rate of unemployment. 
D)  cannot reduce either frictional unemployment or the natural rate of unemployment.

Question 11

According to the theory of efficiency wages, firms operate more efficiently if wages are below the equilibrium level.

Accepted Answer

A) True 
 B)False

Question 12

Table 28-3
2009 Labor Data for Baltivia
  
-Refer to Table 28-3. What was Baltivia's labor­force participation rate in 2009?

Accepted Answer

A)  55% 
B)  63% 
C)  66.9% 
D)  87.3% 
A)  55% 
B)  63% 
C)  66.9% 
D)  87.3%

Question 13

Critics of government-run employment agencies and public training programs argue that the private market is better at matching workers and jobs than the government is.

Accepted Answer

A) True 
 B)False

Question 14

For the Bureau of Labor Statistics to place someone in the "unemployed" category, that person must

Accepted Answer

A)  be available for work. 
B)  have tried to find employment during the previous week. 
C)  have previously been employed. 
D)  All of the above are correct. 
A)  be available for work. 
B)  have tried to find employment during the previous week. 
C)  have previously been employed. 
D)  All of the above are correct.

Question 15

The unemployment that results from the quantity of labor supplied exceeding the quantity demanded is called structural unemployment.

Accepted Answer

A) True 
 B)False

Question 16

Table 28-11
2010 Labor Data for Tajnia
  
-Refer to Table 28-11. The total adult population of Tajnia in 2010 is 30,000.

Accepted Answer

A) True 
 B)False

Question 17

Figure 28-3  
-Refer to Figure 28-3. If the government imposes a minimum wage of $4, then employment will decrease by

Accepted Answer

A)  0 workers. 
B)  2,000 workers. 
C)  3,000 workers. 
D)  4,000 workers. 
A)  0 workers. 
B)  2,000 workers. 
C)  3,000 workers. 
D)  4,000 workers.

Question 18

Efficiency wages

Accepted Answer

A)  increase frictional unemployment by keeping wages above equilibrium. 
B)  decrease frictional unemployment by keeping wages at equilibrium. 
C)  increase structural unemployment by keeping wages above equilibrium. 
D)  decrease structural unemployment by keeping wages at equilibrium. 
A)  increase frictional unemployment by keeping wages above equilibrium. 
B)  decrease frictional unemployment by keeping wages at equilibrium. 
C)  increase structural unemployment by keeping wages above equilibrium. 
D)  decrease structural unemployment by keeping wages at equilibrium.

Question 19

Which of the following is not a cause of frictional unemployment?

Accepted Answer

A)  the destruction of manufacturing jobs 
B)  a worker leaving a job to find one with better benefits 
C)  minimum-wage laws 
D)  unemployment insurance 
A)  the destruction of manufacturing jobs 
B)  a worker leaving a job to find one with better benefits 
C)  minimum-wage laws 
D)  unemployment insurance

Question 20

Both full­time and part­time workers are included in the Bureau of Labor Statistics' "employed" category.

Accepted Answer

A) True 
 B)False

Exam 20: Unemployment

The amount of unemployment that an economy normally experiences is called the

The unemployment that results from the quantity of labor supplied exceeding the quantity demanded is called frictional unemployment.

Wages in excess of their equilibrium level help explain

Unemployment insurance is designed to offer workers full protection against job loss.

Buddy is the owner of a firm that bottles beer in St. Louis, Missouri. There are many other such firms in the area. Buddy decides that if he pays his workers a wage higher than the going market wage, his profits will increase. Which of the following is a likely explanation for his decision?

Adults who were waiting to be recalled to a job from which they had been laid off are included in the Bureau of Labor Statistics' "employed" category.

Which of the following is not correct?

The Bureau of Labor Statistics' U­1 measure of joblessness is smaller than its U­6 measure of joblessness.

Figure 28-5 -Refer to Figure 28-5. If the minimum wage is set at $125, then

Policies that reduce the time it takes unemployed workers to find new jobs

According to the theory of efficiency wages, firms operate more efficiently if wages are below the equilibrium level.

Table 28-3 2009 Labor Data for Baltivia -Refer to Table 28-3. What was Baltivia's labor­force participation rate in 2009?

Critics of government-run employment agencies and public training programs argue that the private market is better at matching workers and jobs than the government is.

For the Bureau of Labor Statistics to place someone in the "unemployed" category, that person must

The unemployment that results from the quantity of labor supplied exceeding the quantity demanded is called structural unemployment.

Table 28-11 2010 Labor Data for Tajnia -Refer to Table 28-11. The total adult population of Tajnia in 2010 is 30,000.

Figure 28-3 -Refer to Figure 28-3. If the government imposes a minimum wage of $4, then employment will decrease by

Efficiency wages

Which of the following is not a cause of frictional unemployment?

Both full­time and part­time workers are included in the Bureau of Labor Statistics' "employed" category.

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 Costs of Production

Firms in Competitive Markets

Monopoly

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

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

Filters

The Bureau of Labor Statistics' U1 measure of joblessness is smaller than its U6 measure of joblessness.

Table 28-3 2009 Labor Data for Baltivia -Refer to Table 28-3. What was Baltivia's laborforce participation rate in 2009?

Both fulltime and parttime workers are included in the Bureau of Labor Statistics' "employed" category.