Question 1

Althea, a brilliant new Ph.D. in economics, has turned down many job offers because she hopes eventually to teach at one of the top 10 universities in her field. The type of unemployment she is experiencing is:

Accepted Answer

A) frictional. 
B) structural. 
C) seasonal. 
D) cyclical. 
E) underemployment.

Question 2

In the United States, the unemployment rate for women is roughly the same as the unemployment rate for men.

Accepted Answer

A) True 
 B)False

Question 3

Full employment is the situation in which the economy operates at an unemployment rate equal to the sum of:

Accepted Answer

A) structural and frictional unemployment. 
B) cyclical and frictional unemployment. 
C) structural and cyclical unemployment. 
D) structural, frictional, and cyclical unemployment.

Question 4

The combination of frictional and structural unemployment is the:

Accepted Answer

A) cyclical rate of unemployment. 
B) transitional rate of unemployment. 
C) civilian rate of unemployment. 
D) natural rate of unemployment.

Question 5

The unemployment rate equals the number of persons:

Accepted Answer

A) unemployed divided by the number employed. 
B) unemployed divided by the number in the labor force. 
C) unemployed divided by the population age 16 and over. 
D) not working divided by the population age 16 and over.

Question 6

When actual real GDP output is below full-employment real GDP, the GDP measures the cost of cyclical unemployment.

Accepted Answer

A) True 
 B)False

Question 7

Business cycles vary greatly in duration and intensity.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following people would be officially counted as unemployed?

Accepted Answer

A) A person who works only 5 hours per week for pay. 
B) A full-time college student who chooses not to have a paying job. 
C) A family member who works 20 hours per week without pay. 
D) A jobless high-school graduate who is actively looking for work.

Question 9

Exhibit 6-3 Unemployment categories
 According to data in Exhibit 6-3 and assuming the total number of workers is 8,400, the unemployment rate is:

Accepted Answer

A) 14 percent. 
B) 15 percent. 
C) 16 percent. 
D) 19 percent. 
E) 24 percent.

Question 10

Which of the following is true ?

Accepted Answer

A) The GDP gap is the difference between actual real GDP and full-employment real GDP. 
B) We desire economic growth because it increases the nation's standard of living. 
C) Economic growth is measured by the annual percentage increase in a nation's real GDP. 
D) Discouraged workers are a reason critics say the unemployment rate is understated. 
E) All of these are true.

Question 11

Bob is unemployed because his skills have become obsolete due to technological advances. This is ____ unemployment.

Accepted Answer

A) frictional 
B) structural 
C) cyclical 
D) abnormal

Question 12

Cyclical unemployment:

Accepted Answer

A) causes unemployment statistics to be understated. 
B) causes unemployment statistics to be overstated. 
C) occurs because of recessions. 
D) occurs because of technological innovations in production. 
E) only occurs with a zero inflation rate.

Question 13

Cyclical unemployment refers to unemployment resulting from:

Accepted Answer

A) a mismatch of skills. 
B) being in the wrong geographical location. 
C) the time and monetary cost of finding the best job. 
D) a recession.

Question 14

Suppose the index of leading economic indicators begins to decline for several months. Which of the following economic events will likely follow?

Accepted Answer

A) A recession. 
B) Severe inflation. 
C) Greater employment. 
D) Higher investment.

Question 15

The government's chief forecasting gauge for business cycles is the chained real GDP indicators.

Accepted Answer

A) True 
 B)False

Question 16

A person who voluntarily quits his\her job in New York and expects to get a similar job in Los Angeles is an example of:

Accepted Answer

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

Question 17

Unemployment that is of a short duration to allow time to find a new job is:

Accepted Answer

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

Question 18

Suppose u = those adults who are unemployed and seeking work; e = those adults who are employed; and NLF = those adults not in the labor force. Which expression would equal the BLS definition of the unemployment rate?

Accepted Answer

A) u \ (e + NLF) 
B) u \ e 
C) u \ (u + e) 
D) u \ (u + e - NLF)

Question 19

Structural unemployment is a special type of cyclical unemployment.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following demographic groups in the U.S. has the highest unemployment rates?

Accepted Answer

A) College graduates. 
B) White working-age people. 
C) African-American teenage males. 
D) All working-age people with a high school diploma but no college.

Exam 6: Business Cycles and Unemployment

Althea, a brilliant new Ph.D. in economics, has turned down many job offers because she hopes eventually to teach at one of the top 10 universities in her field. The type of unemployment she is experiencing is:

In the United States, the unemployment rate for women is roughly the same as the unemployment rate for men.

Full employment is the situation in which the economy operates at an unemployment rate equal to the sum of:

The combination of frictional and structural unemployment is the:

The unemployment rate equals the number of persons:

When actual real GDP output is below full-employment real GDP, the GDP measures the cost of cyclical unemployment.

Business cycles vary greatly in duration and intensity.

Which of the following people would be officially counted as unemployed?

Exhibit 6-3 Unemployment categories According to data in Exhibit 6-3 and assuming the total number of workers is 8,400, the unemployment rate is:

Which of the following is true ?

Bob is unemployed because his skills have become obsolete due to technological advances. This is ____ unemployment.

Cyclical unemployment:

Cyclical unemployment refers to unemployment resulting from:

Suppose the index of leading economic indicators begins to decline for several months. Which of the following economic events will likely follow?

The government's chief forecasting gauge for business cycles is the chained real GDP indicators.

A person who voluntarily quits his\her job in New York and expects to get a similar job in Los Angeles is an example of:

Unemployment that is of a short duration to allow time to find a new job is:

Suppose u = those adults who are unemployed and seeking work; e = those adults who are employed; and NLF = those adults not in the labor force. Which expression would equal the BLS definition of the unemployment rate?

Structural unemployment is a special type of cyclical unemployment.

Which of the following demographic groups in the U.S. has the highest unemployment rates?