Question 1

When the wage is above the equilibrium level,

Accepted Answer

A)  the labor market is functioning more efficiently than it otherwise would function. 
B)  there is a shortage of labor. 
C)  the quantity of labor supplied exceeds the quantity of labor demanded. 
D)  job search is the primary explanation for the unemployment that is observed. 
A)  the labor market is functioning more efficiently than it otherwise would function. 
B)  there is a shortage of labor. 
C)  the quantity of labor supplied exceeds the quantity of labor demanded. 
D)  job search is the primary explanation for the unemployment that is observed.

Question 2

Who of the following is not included in the Bureau of Labor Statistics' "employed" category?

Accepted Answer

A)  those who worked in their own business 
B)  those who worked as unpaid workers in a family member's business 
C)  those waiting to be recalled to a job from which they had been laid off 
D)  those who were temporarily absent from work because of vacation. 
A)  those who worked in their own business 
B)  those who worked as unpaid workers in a family member's business 
C)  those waiting to be recalled to a job from which they had been laid off 
D)  those who were temporarily absent from work because of vacation.

Question 3

Which of the following is not correct?

Accepted Answer

A)  The unemployment rate is an imperfect measure of a nation's overall level of economic well­being. 
B)  Most job search in the U.S. economy takes place without intervention by the government. 
C)  Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well-being. 
D)  Other things the same, countries that offer more generous and longer-lasting unemployment insurance benefits are likely to have higher unemployment rates. 
A)  The unemployment rate is an imperfect measure of a nation's overall level of economic well­being. 
B)  Most job search in the U.S. economy takes place without intervention by the government. 
C)  Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well-being. 
D)  Other things the same, countries that offer more generous and longer-lasting unemployment insurance benefits are likely to have higher unemployment rates.

Question 4

To maintain their standard of living, most people rely on

Accepted Answer

A)  government assistance. 
B)  their labor earnings. 
C)  their personal savings. 
D)  All of the above are correct. 
A)  government assistance. 
B)  their labor earnings. 
C)  their personal savings. 
D)  All of the above are correct.

Question 5

Which of the following causes of unemployment is not associated with a wage rate above the market equilibrium level?

Accepted Answer

A)  efficiency wages 
B)  job search 
C)  minimum-wage laws 
D)  unions 
A)  efficiency wages 
B)  job search 
C)  minimum-wage laws 
D)  unions

Question 6

Three employers have justified their actions as follows. Whose logic is not consistent with the logic of efficiency wage theory?

Accepted Answer

A)  Instead of spending money on an electronic timing system that monitors worker hours, Tom spends an equivalent amount of money on higher wages. 
B)  Dick pays his workers less than the equilibrium wage so that they will not have the time or money to look for work somewhere else. 
C)  Harry pays his workers in a developing country more than the going wage hoping that they will get a better diet and so be more productive. 
D)  None of the above is consistent with the logic of efficiency wage theory. 
A)  Instead of spending money on an electronic timing system that monitors worker hours, Tom spends an equivalent amount of money on higher wages. 
B)  Dick pays his workers less than the equilibrium wage so that they will not have the time or money to look for work somewhere else. 
C)  Harry pays his workers in a developing country more than the going wage hoping that they will get a better diet and so be more productive. 
D)  None of the above is consistent with the logic of efficiency wage theory.

Question 7

In one year, you meet 52 people who are each unemployed for one week and eight people who are each unemployed for the whole year. What percentage of the unemployment spells you encountered was short term, and what percentage of the unemployment you encountered in a given week was long term?

Accepted Answer

A)  52% was short term; 13.3% was long term 
B)  52% was short term; 88.9% was long term 
C)  86.7% was short term; 13.3 was long term 
D)  86.7% was short term; 88.9 was long term 
A)  52% was short term; 13.3% was long term 
B)  52% was short term; 88.9% was long term 
C)  86.7% was short term; 13.3 was long term 
D)  86.7% was short term; 88.9 was long term

Question 8

Suppose that a well-respected study published in Child Psychology Today finds that a very high proportion of children raised by stay-at-home fathers are accepted to Harvard University. If a large number of previously working fathers quit their jobs and become stay-at-home dads, which of the following will occur, all else equal? i) The unemployment rate will decrease.
Ii) The size of the labor force will decrease.
Iii) The number of unemployed people will increase.
Iv) The unemployment rate will increase.

Accepted Answer

A)  i) and ii) only 
B)  ii) and iv) only 
C)  i), ii), and iii) only 
D)  ii), iii), and iv) only 
A)  i) and ii) only 
B)  ii) and iv) only 
C)  i), ii), and iii) only 
D)  ii), iii), and iv) only

Question 9

Someone who has a job but is absent from work because she is on vacation is counted as "employed."

Accepted Answer

A) True 
 B)False

Question 10

One reason economies always experience some unemployment is job search.

Accepted Answer

A) True 
 B)False

Question 11

Table 28-4
2010 Labor Data for Adults ages 16 and older) in Meditor
  
-Refer to Table 28-4. What is the adult labor-force participation rate in Meditor?

Accepted Answer

A)  37.5% 
B)  62.5% 
C)  66.7% 
D)  95.8% 
A)  37.5% 
B)  62.5% 
C)  66.7% 
D)  95.8%

Question 12

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, the quantity of labor supplied is higher and the quantity demanded of labor is lower than at the equilibrium wage.

Accepted Answer

A) True 
 B)False

Question 13

Suppose that because of the popularity of the low-carb diet, bakeries need fewer workers and steak houses need more workers. The unemployment created by this change is

Accepted Answer

A)  frictional unemployment created by efficiency wages. 
B)  frictional unemployment created by sectoral shifts. 
C)  structural unemployment created by efficiency wages. 
D)  structural unemployment created by sectoral shifts. 
A)  frictional unemployment created by efficiency wages. 
B)  frictional unemployment created by sectoral shifts. 
C)  structural unemployment created by efficiency wages. 
D)  structural unemployment created by sectoral shifts.

Question 14

According to the theory of efficiency wages, if a firm stops paying efficiency wages it is likely to see an)

Accepted Answer

A)  increase in the number of job applicants and an increase in how long workers stay on the job. 
B)  increase in the number of job applicants and a decrease in how long workers stay on the job. 
C)  decrease in the number of job applicants and an increase in how long workers stay on the job. 
D)  decrease in the number of job applicants and a decrease in how long workers stay on the job. 
A)  increase in the number of job applicants and an increase in how long workers stay on the job. 
B)  increase in the number of job applicants and a decrease in how long workers stay on the job. 
C)  decrease in the number of job applicants and an increase in how long workers stay on the job. 
D)  decrease in the number of job applicants and a decrease in how long workers stay on the job.

Question 15

An important determinant of a country's standard of living is the amount of it typically experiences.

Accepted Answer

The answer of An important determinant of a country's standard...

Question 16

Advocates of government-run employment agencies and public training programs believe they make job search more efficient.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is not correct?

Accepted Answer

A)  Unions are exempt from U.S. antitrust laws. 
B)  The Wagner Act of 1935 prevents U.S. employers from interfering when workers try to organize unions. 
C)  The National Labor Relations Board is the U.S. government agency that enforces workers' right to unionize. 
D)  Right-to-work laws prevent firms from hiring permanent replacements for workers who are on strike. 
A)  Unions are exempt from U.S. antitrust laws. 
B)  The Wagner Act of 1935 prevents U.S. employers from interfering when workers try to organize unions. 
C)  The National Labor Relations Board is the U.S. government agency that enforces workers' right to unionize. 
D)  Right-to-work laws prevent firms from hiring permanent replacements for workers who are on strike.

Question 18

Gwen is an unpaid worker in her family's restaurant. The Bureau of Labor Statistics counts Gwen as

Accepted Answer

A)  unemployed and in the labor force. 
B)  unemployed and not in the labor force. 
C)  employed and in the labor force. 
D)  employed and not in the labor force. 
A)  unemployed and in the labor force. 
B)  unemployed and not in the labor force. 
C)  employed and in the labor force. 
D)  employed and not in the labor force.

Question 19

An economist claims that changes in information technology and unemployment insurance have reduced unemployment. Which of these changes affect frictional unemployment?

Accepted Answer

A)  both the changes in information technology and unemployment insurance 
B)  only the changes in information technology 
C)  only the changes in unemployment insurance 
D)  neither the changes in information technology nor the changes in unemployment insurance 
A)  both the changes in information technology and unemployment insurance 
B)  only the changes in information technology 
C)  only the changes in unemployment insurance 
D)  neither the changes in information technology nor the changes in unemployment insurance

Question 20

A typical American worker covered by unemployment insurance receives 50 percent of his former wages for 52 weeks.

Accepted Answer

A) True 
 B)False

Exam 20: Unemployment

When the wage is above the equilibrium level,

Who of the following is not included in the Bureau of Labor Statistics' "employed" category?

Which of the following is not correct?

To maintain their standard of living, most people rely on

Which of the following causes of unemployment is not associated with a wage rate above the market equilibrium level?

Three employers have justified their actions as follows. Whose logic is not consistent with the logic of efficiency wage theory?

In one year, you meet 52 people who are each unemployed for one week and eight people who are each unemployed for the whole year. What percentage of the unemployment spells you encountered was short term, and what percentage of the unemployment you encountered in a given week was long term?

Someone who has a job but is absent from work because she is on vacation is counted as "employed."

One reason economies always experience some unemployment is job search.

Table 28-4 2010 Labor Data for Adults ages 16 and older) in Meditor -Refer to Table 28-4. What is the adult labor-force participation rate in Meditor?

When a minimum-wage law forces the wage to remain above the level that balances supply and demand, the quantity of labor supplied is higher and the quantity demanded of labor is lower than at the equilibrium wage.

Suppose that because of the popularity of the low-carb diet, bakeries need fewer workers and steak houses need more workers. The unemployment created by this change is

According to the theory of efficiency wages, if a firm stops paying efficiency wages it is likely to see an)

An important determinant of a country's standard of living is the amount of it typically experiences.

Advocates of government-run employment agencies and public training programs believe they make job search more efficient.

Which of the following is not correct?

Gwen is an unpaid worker in her family's restaurant. The Bureau of Labor Statistics counts Gwen as

An economist claims that changes in information technology and unemployment insurance have reduced unemployment. Which of these changes affect frictional unemployment?

A typical American worker covered by unemployment insurance receives 50 percent of his former wages for 52 weeks.

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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