Exam 15: Unemployment

Table 28-8 Below is data about the labor market in the state of Northwoods. -Refer to Table 28-8. If the state government imposed a minimum wage of $9, how many people would be unemployed?

What is the theory of efficiency wages? Provide four reasons that employers might pay efficiency wages.

Advocates of unions contend that unions are a necessary antidote to the market power of the firms that hire workers and that unions are important for helping firms respond efficiently to workers' concerns.

Figure 28-4 -Refer to Figure 28-4. If the government imposes a minimum wage of $4, how many workers will be unemployed?

Frictional unemployment is often the result of changes in the demand for labor among different firms.

The destruction of manufacturing jobs and workers leaving their jobs to find better ones both contribute to structural unemployment.

Minimum wages create unemployment in markets where they create a

Suppose that bartenders and waiters have no unions. Now suppose that bartenders form a union. What does this do the labor supply and wages of waiters?

When a union raises the wage above the equilibrium level,

Long-run unemployment arises from a single problem that has a single solution.

Suppose that garbage collectors and landscaping workers have no unions. Now suppose that garbage collectors form unions. What does this do the labor supply and wages of landscaping workers?

Unions contribute to

The natural rate of unemployment is the desirable rate of unemployment for an economy.

When a union bargains successfully with employers, in that industry,

The labor-force participation rate measures the percentage of the

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

Just after World War II, the labor-force participation rate of men was

Consider two labor markets in which jobs are equally attractive in all respects other than the wage rate. All workers are equally able to do either job. Initially, both labor markets are perfectly competitive. If a union organizes workers in one of the markets, then the wage rates will tend to

A firm may pay efficiency wages in an attempt to

If the natural rate of unemployment is 5.2 percent and the actual rate of unemployment is 5.7 percent, then by definition there is