Question 1

Government policy can do nothing about the natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 2

The unemployment rate is computed as the number of unemployed

Accepted Answer

A)  divided by the labor force, all times 100. 
B)  divided by the number of employed, all times 100. 
C)  divided by the adult population, all times 100. 
D)  times the labor-force participation rate, all times 100. 
A)  divided by the labor force, all times 100. 
B)  divided by the number of employed, all times 100. 
C)  divided by the adult population, all times 100. 
D)  times the labor-force participation rate, all times 100.

Question 3

The natural rate of unemployment i) is the economy's desirable level of unemployment.
Ii) arises from a single problem that has a single solution.
Iii) is the amount of unemployment that does not go away on its own.

Accepted Answer

A)  i) and ii) only 
B)  iii) only 
C)  i), ii), and iii) 
D)  None of the above is correct. 
A)  i) and ii) only 
B)  iii) only 
C)  i), ii), and iii) 
D)  None of the above is correct.

Question 4

There is no easy way for policymakers to reduce the economy's natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 5

The natural rate of unemployment is the

Accepted Answer

A)  unemployment rate that would prevail with zero inflation. 
B)  rate associated with the highest possible level of GDP. 
C)  difference between the long-run and short-run unemployment rates. 
D)  amount of unemployment that the economy normally experiences. 
A)  unemployment rate that would prevail with zero inflation. 
B)  rate associated with the highest possible level of GDP. 
C)  difference between the long-run and short-run unemployment rates. 
D)  amount of unemployment that the economy normally experiences.

Question 6

Figure 28-7  
-Refer to Figure 28-7. If the minimum wage is set at $100, how many will be unemployed?

Accepted Answer

The answer of Figure 28-7  
-Refer to Figure 28-7....

Question 7

Some persons are counted as out of the labor force because they have made no serious or recent effort to look for work. However, some of these individuals may want to work even though they are too discouraged to make a serious effort to look for work. If these individuals were counted as unemployed instead of out of the labor force, then

Accepted Answer

A)  both the unemployment rate and labor-force participation rate would be higher. 
B)  the unemployment rate would be higher ,and the labor-force participation rate would be lower. 
C)  the unemployment rate would be lower, and the labor-force participation rate would be higher. 
D)  both the unemployment rate and labor-force participation rate would be lower. 
A)  both the unemployment rate and labor-force participation rate would be higher. 
B)  the unemployment rate would be higher ,and the labor-force participation rate would be lower. 
C)  the unemployment rate would be lower, and the labor-force participation rate would be higher. 
D)  both the unemployment rate and labor-force participation rate would be lower.

Question 8

Scenario 28-1
Suppose that the Bureau of Labor Statistics reports that the entire adult population of Mankiwland can be categorized as follows: 25 million people employed, 3 million people unemployed, 1 million discouraged workers, and 1 million people who are either students, homemakers, retirees, or other people not seeking employment.
-Refer to Scenario 28-1. What is the unemployment rate?

Accepted Answer

A)  3.3% 
B)  6.7% 
C)  10.7% 
D)  12% 
A)  3.3% 
B)  6.7% 
C)  10.7% 
D)  12%

Question 9

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, there are more workers willing to work than there are jobs, so some workers are unemployed.

Accepted Answer

A) True 
 B)False

Question 10

Suppose that roofers are not unionized. If roofers unionize, then the supply of labor in other sectors of the economy will

Accepted Answer

A)  decrease, raising wages in industries that are not unionized. 
B)  decrease, reducing wages in industries that are not unionized. 
C)  increase, raising wages in industries that are not unionized. 
D)  increase, reducing wages in industries that are not unionized. 
A)  decrease, raising wages in industries that are not unionized. 
B)  decrease, reducing wages in industries that are not unionized. 
C)  increase, raising wages in industries that are not unionized. 
D)  increase, reducing wages in industries that are not unionized.

Question 11

Which of the following is correct?

Accepted Answer

A)  The labor-force participation rate of women has increased in part due to smaller families. 
B)  The labor-force participation rate of men has decreased in part due to men retiring younger and living longer. 
C)  Both a and b are correct. 
D)  Neither a nor b is correct. 
A)  The labor-force participation rate of women has increased in part due to smaller families. 
B)  The labor-force participation rate of men has decreased in part due to men retiring younger and living longer. 
C)  Both a and b are correct. 
D)  Neither a nor b is correct.

Question 12

Every month when the Bureau of Labor Statistics BLS) announces the unemployment rate, it also announces the number of jobs the economy has gained or lost. Where does the BLS get the data about jobs?

Accepted Answer

A)  from the survey of 60,000 households, which is called the Current Population Survey 
B)  from the Establishment Survey that measures both frictional and structural unemployment 
C)  from the survey of 160,000 business that have over 40 million workers on their payrolls 
D)  from the Congressional Budget Office, which also calculates the GDP of the United States 
A)  from the survey of 60,000 households, which is called the Current Population Survey 
B)  from the Establishment Survey that measures both frictional and structural unemployment 
C)  from the survey of 160,000 business that have over 40 million workers on their payrolls 
D)  from the Congressional Budget Office, which also calculates the GDP of the United States

Question 13

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 14

Table 28-1
Sample Population
  
-Refer to Table 28-1. How many in the sample are unemployed?

Accepted Answer

A)  5 
B)  4 
C)  3 
D)  2 
A)  5 
B)  4 
C)  3 
D)  2

Question 15

Suppose that efficiency wages become more common in the economy. Imposing efficiency wages

Accepted Answer

A)  increases the quantity demanded and decreases the quantity supplied of labor. 
B)  decreases the quantity demanded and increases the quantity supplied of labor. 
C)  increases the quantity demanded and decreases the quantity supplied of labor 
D)  decreases the quantity demanded and increases the quantity supplied of labor 
A)  increases the quantity demanded and decreases the quantity supplied of labor. 
B)  decreases the quantity demanded and increases the quantity supplied of labor. 
C)  increases the quantity demanded and decreases the quantity supplied of labor 
D)  decreases the quantity demanded and increases the quantity supplied of labor

Question 16

If the minimum wage were currently above the equilibrium wage, then a decrease in the minimum wage that kept it above the equilibrium wage would

Accepted Answer

A)  increase the surplus of labor. 
B)  reduce the surplus of labor. 
C)  increase the shortage of labor. 
D)  reduce the shortage of labor, 
A)  increase the surplus of labor. 
B)  reduce the surplus of labor. 
C)  increase the shortage of labor. 
D)  reduce the shortage of labor,

Question 17

Who of the following is counted as "unemployed" by the Bureau of Labor Statistics?

Accepted Answer

A)  someone working without pay for a family member's business 
B)  someone who is absent from their job due to illness 
C)  someone on temporary layoff 
D)  All of the above are correct. 
A)  someone working without pay for a family member's business 
B)  someone who is absent from their job due to illness 
C)  someone on temporary layoff 
D)  All of the above are correct.

Question 18

Table 28-7
Below is data about the labor market in the city of Productionville.
  
-Refer to Table 28-7. If the local government imposed a minimum wage of $4 in Productionville, how many people would be unemployed?

Accepted Answer

A)  0 
B)  2,000 
C)  3,000 
D)  10,000 
A)  0 
B)  2,000 
C)  3,000 
D)  10,000

Question 19

Explain how the following apparently contradictory statement can be true: Most spells of unemployment are short, and most unemployment observed at any given time is long-term.

Accepted Answer

Most people who become unemplo

Question 20

The main explanation for the lower growth rate for the American economy in the 21st century compared to the previous 250 years is

Accepted Answer

A)  higher minimum wages. 
B)  that although Americans are working more, they are more distracted by technology and therefore are less productive at work. 
C)  that Americans are working less. 
D)  the increasing labor-force participation rates of women with young children. 
A)  higher minimum wages. 
B)  that although Americans are working more, they are more distracted by technology and therefore are less productive at work. 
C)  that Americans are working less. 
D)  the increasing labor-force participation rates of women with young children.

Exam 20: Unemployment

Government policy can do nothing about the natural rate of unemployment.

The unemployment rate is computed as the number of unemployed

The natural rate of unemployment i) is the economy's desirable level of unemployment. Ii) arises from a single problem that has a single solution. Iii) is the amount of unemployment that does not go away on its own.

There is no easy way for policymakers to reduce the economy's natural rate of unemployment.

The natural rate of unemployment is the

Figure 28-7 -Refer to Figure 28-7. If the minimum wage is set at $100, how many will be unemployed?

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, there are more workers willing to work than there are jobs, so some workers are unemployed.

Suppose that roofers are not unionized. If roofers unionize, then the supply of labor in other sectors of the economy will

Which of the following is correct?

Every month when the Bureau of Labor Statistics BLS) announces the unemployment rate, it also announces the number of jobs the economy has gained or lost. Where does the BLS get the data about jobs?

Measuring unemployment is the job of the

Table 28-1 Sample Population -Refer to Table 28-1. How many in the sample are unemployed?

Suppose that efficiency wages become more common in the economy. Imposing efficiency wages

If the minimum wage were currently above the equilibrium wage, then a decrease in the minimum wage that kept it above the equilibrium wage would

Who of the following is counted as "unemployed" by the Bureau of Labor Statistics?

Table 28-7 Below is data about the labor market in the city of Productionville. -Refer to Table 28-7. If the local government imposed a minimum wage of $4 in Productionville, how many people would be unemployed?

Explain how the following apparently contradictory statement can be true: Most spells of unemployment are short, and most unemployment observed at any given time is long-term.

The main explanation for the lower growth rate for the American economy in the 21st century compared to the previous 250 years is

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

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