Question 1

The normal rate of unemployment around which the unemployment rate fluctuates is called the natural rate of unemployment.

Accepted Answer

A) True 
 B)False  True

Question 2

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 $7 in Productionville, how many people would be unemployed?

Accepted Answer

A)  0 
B)  2,000 
C)  5,000 
D)  10,000 
A)  0 
B)  2,000 
C)  5,000 
D)  10,000 C

Question 3

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

Accepted Answer

A)  rise in both markets. 
B)  fall in both markets 
C)  rise for the union jobs, but remain unchanged for the nonunion jobs. 
D)  rise for the union jobs and fall for the nonunion jobs. 
A)  rise in both markets. 
B)  fall in both markets 
C)  rise for the union jobs, but remain unchanged for the nonunion jobs. 
D)  rise for the union jobs and fall for the nonunion jobs. D

Question 4

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 5

Give a few examples of how sectoral shifts temporarily cause unemployment.

Accepted Answer

Examples should focus on sectors of the

Question 6

Discouraged workers are included in

Accepted Answer

A)  the number of unemployed. 
B)  frictional unemployment. 
C)  the labor force. 
D)  None of the above is correct. 
A)  the number of unemployed. 
B)  frictional unemployment. 
C)  the labor force. 
D)  None of the above is correct.

Question 7

Structural unemployment results when the number of jobs is insufficient for the number of workers.

Accepted Answer

A) True 
 B)False

Question 8

Octavia does not currently have a job, but she has applied for several jobs in the previous week. Eve is an unpaid stay-at-home mom who has not searched for work in recent years. Who does the Bureau of Labor Statistics count as "out of the labor force"?

Accepted Answer

A)  Octavia but not Eve 
B)  Eve but not Octavia 
C)  both Octavia and Eve 
D)  neither Octavia nor Eve 
A)  Octavia but not Eve 
B)  Eve but not Octavia 
C)  both Octavia and Eve 
D)  neither Octavia nor Eve

Question 9

Most people rely primarily on income other than their labor earnings to maintain their standard of living.

Accepted Answer

A) True 
 B)False

Question 10

Minimum-wage laws can keep wages

Accepted Answer

A)  above equilibrium and cause a surplus of labor. 
B)  above equilibrium and cause a shortage of labor. 
C)  below equilibrium and cause a surplus of labor. 
D)  below equilibrium and cause a shortage of labor. 
A)  above equilibrium and cause a surplus of labor. 
B)  above equilibrium and cause a shortage of labor. 
C)  below equilibrium and cause a surplus of labor. 
D)  below equilibrium and cause a shortage of labor.

Question 11

People who are unemployed because they are in search of a job that suits their skills are included within

Accepted Answer

A)  structural unemployment. 
B)  frictional unemployment. 
C)  cyclical unemployment. 
D)  marginal unemployment. 
A)  structural unemployment. 
B)  frictional unemployment. 
C)  cyclical unemployment. 
D)  marginal unemployment.

Question 12

President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that

Accepted Answer

A)  one of them must be lying. 
B)  both of them could be telling the truth if the labor force, and employment grew at the exact same rate. 
C)  both of them could be telling the truth if the labor force grew slower than employment. 
D)  both of them could be telling the truth if the labor force grew faster than employment. 
A)  one of them must be lying. 
B)  both of them could be telling the truth if the labor force, and employment grew at the exact same rate. 
C)  both of them could be telling the truth if the labor force grew slower than employment. 
D)  both of them could be telling the truth if the labor force grew faster than employment.

Question 13

Most spells of unemployment are long, and most unemployment observed at any given time is long-term.

Accepted Answer

A) True 
 B)False

Question 14

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 15

Three possible reasons for an above-equilibrium wage are minimum-wage laws, unions, and efficiency wages.

Accepted Answer

A) True 
 B)False

Question 16

Eric was laid off two months ago. He has not searched for other work because he is expecting to be recalled to work. The Bureau of Labor Statistics counts Eric 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)  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)  not in the labor force.

Question 17

Suppose that the adult population in the country of Atlantis is 115 million. If 80 million people are employed and 5 million are unemployed, then

Accepted Answer

A)  30 million are not in the labor force. 
B)  35 million are in the labor force. 
C)  75 million are in the labor force. 
D)  35 million are not in the labor force. 
A)  30 million are not in the labor force. 
B)  35 million are in the labor force. 
C)  75 million are in the labor force. 
D)  35 million are not in the labor force.

Question 18

Table 28-4
2010 Labor Data for Adults (ages 16 and older) in Meditor  
-Refer to Table 28-4. What is the adult female population in Meditor?

Accepted Answer

A)  40 million 
B)  70 million 
C)  100 million 
D)  105 million 
A)  40 million 
B)  70 million 
C)  100 million 
D)  105 million

Question 19

Data on the unemployment rate in the U.S. since 1960 show that the unemployment rate is

Accepted Answer

A)  always zero. 
B)  sometimes zero. 
C)  rarely zero. 
D)  never zero. 
A)  always zero. 
B)  sometimes zero. 
C)  rarely zero. 
D)  never zero.

Question 20

In 2009, based on concepts similar to those used to estimate U.S. employment figures, the Swedish adult non- institutionalized population was 7.568 million, the labor force was 4.888 million, and the number of people employed was 4.486 million. According to these numbers, the Swedish labor-force participation rate and unemployment rate were about

Accepted Answer

A)  64.6% and 8.2%. 
B)  64.6% and 5.3%. 
C)  59.3% and 8.2%. 
D)  59.3% and 5.3%. 
A)  64.6% and 8.2%. 
B)  64.6% and 5.3%. 
C)  59.3% and 8.2%. 
D)  59.3% and 5.3%.

Exam 28: Unemployment

The normal rate of unemployment around which the unemployment rate fluctuates is called the natural rate of unemployment.

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 $7 in Productionville, how many people would be unemployed?

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

Wages in excess of their equilibrium level help explain

Give a few examples of how sectoral shifts temporarily cause unemployment.

Discouraged workers are included in

Structural unemployment results when the number of jobs is insufficient for the number of workers.

Octavia does not currently have a job, but she has applied for several jobs in the previous week. Eve is an unpaid stay-at-home mom who has not searched for work in recent years. Who does the Bureau of Labor Statistics count as "out of the labor force"?

Most people rely primarily on income other than their labor earnings to maintain their standard of living.

Minimum-wage laws can keep wages

People who are unemployed because they are in search of a job that suits their skills are included within

President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that

Most spells of unemployment are long, and most unemployment observed at any given time is long-term.

Which of the following is not correct?

Three possible reasons for an above-equilibrium wage are minimum-wage laws, unions, and efficiency wages.

Eric was laid off two months ago. He has not searched for other work because he is expecting to be recalled to work. The Bureau of Labor Statistics counts Eric as

Suppose that the adult population in the country of Atlantis is 115 million. If 80 million people are employed and 5 million are unemployed, then

Table 28-4 2010 Labor Data for Adults (ages 16 and older) in Meditor -Refer to Table 28-4. What is the adult female population in Meditor?

Data on the unemployment rate in the U.S. since 1960 show that the unemployment rate 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 Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

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

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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