Question 1

When unions raise wages in some sectors of the economy,the supply of labor in other sectors of the economy

Accepted Answer

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

Question 2

Which of the following explanations of the natural rate of unemployment is most important for the U.S.economy?

Accepted Answer

A) job search 
B) minimum-wage laws 
C) unions 
D) Economists have not determined the answer to this question.

Question 3

Jenna is searching for a job that suits her tastes about where to live and the people she works with.Mary is looking for a job that makes best use of her skills.

Accepted Answer

A) Jenna and Mary are both frictionally unemployed. 
B) Jenna and Mary are both structurally unemployed. 
C) Jenna is frictionally unemployed, and Mary is structurally unemployed. 
D) Jenna is structurally unemployed, and Mary is frictionally unemployed.

Question 4

The BLS reported in 2005 that there were 59.98 million people over age 25 whose highest level of education was a high school degree or equivalent.From this group 36.40 million were employed and 1.93 million were unemployed.About what were the labor-force participation rate and the unemployment rate for this group?

Accepted Answer

A) 60.7%, 5.0% 
B) 63.9%, 5.0% 
C) 60.7%, 3.2% 
D) 63.9%, 3.2%

Question 5

Tom loses his job and immediately begins looking for another.Other things the same,the unemployment rate

Accepted Answer

A) increases, and the labor-force participation rate decreases. 
B) increases, and the labor-force participation rate is unaffected. 
C) is unaffected, and the labor-force participation rate increases. 
D) decreases, and the labor-force participation rate is unaffected.

Question 6

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 participation rate and the labor force both fell. 
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 7

Which of the following is not correct?

Accepted Answer

A) The unemployment rate is computed using the number of unemployment insurance claims filed. 
B) Each adult included in the unemployment statistics is classified as employed, unemployed, or not in the labor force. 
C) Unemployment numbers are based only on people aged sixteen and older. 
D) The Bureau of Labor Statistics gathers data on unemployment and employment.

Question 8

Suppose that some people report themselves as unemployed when,in fact,they are working in the underground economy.If these persons were counted as employed,

Accepted Answer

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

Question 9

Labor Stats
The Labor Market
This table shows the 2003 data for males and females ages 16 and over in the imaginary country of Meditor.
 
-Refer to Labor Stats.What is the adult labor-force participation rate in Meditor?

Accepted Answer

A) 4.12% 
B) 12.50% 
C) 37.50% 
D) 66.67%

Question 10

Which of the following is correct concerning minimum wage laws?

Accepted Answer

A) They are a major cause of unemployment in the U.S. 
B) They probably have the most impact on those with the least skills and least experience. 
C) About 20 percent of full-time workers age 25 who receive hourly wages report they earn the minimum wage or less. 
D) All of the above are correct.

Question 11

In the United States in recent years,for people age 20 and over,the unemployment rate of blacks has been

Accepted Answer

A) less than that of whites. 
B) about the same as that of whites. 
C) about 50 percent higher than that of whites. 
D) about double that of whites.

Question 12

A person who is counted as unemployed by the BLS is

Accepted Answer

A) also in the labor force. 
B) must have recently looked for work or be on temporary layoff. 
C) be age 16 or over. 
D) All of the above are correct.

Question 13

People who are unemployed because of job search are best classified as

Accepted Answer

A) cyclically unemployed. 
B) structurally unemployed. 
C) frictionally unemployed. 
D) discouraged workers.

Question 14

Jack is a full-time unpaid homemaker not currently searching for other work.Jill is a full-time student who is not looking for a job.Who does the BLS count in the labor force?

Accepted Answer

A) only Jack 
B) only Jill 
C) both Jack and Jill 
D) neither Jack nor Jill

Question 15

Anna has just finished high school and started looking for her first job,but has not yet found one.As a result,the unemployment rate

Accepted Answer

A) increases, and the labor-force participation rate is unaffected. 
B) increases, and the labor-force participation rate increases. 
C) is unaffected, and the labor-force participation rate increases. 
D) increases, and the labor-force participation rate decreases.

Question 16

Use the following table to answer the following questions.
Table 28-1
 
-Refer to Table 28-1.What is the U-6 measure of labor underutilization?

Accepted Answer

A) 7.95 percent 
B) 8.1 percent 
C) 9.0 percent 
D) 9.2 percent

Question 17

Suppose some country had an adult population of about 46.5 million,the labor-force participation rate was 63.5 percent,and the unemployment rate was 5.8 percent.What were the number of people employed and the number of people unemployed?

Accepted Answer

A) about 29.5 million and 2.7 million. 
B) about 29.5 million and 1.7 million. 
C) about 27.8 million and 2.7 million. 
D) about 27.8 million and 1.7 million.

Question 18

Since 1950,the labor-force participation rate of women has

Accepted Answer

A) increased.This can be attributed to longer lives. 
B) increased.This can be attributed partly to advances in birth control. 
C) decreased.This can be attributed partly to longer schooling. 
D) decreased.This can be attributed partly to increases in the minimum wage.

Question 19

In the BLS statistics,discouraged workers

Accepted Answer

A) are included in the numerator of U-3 (the official unemployment rate). 
B) are not also counted as marginally attached workers. 
C) includes people working part time for economic reasons. 
D) have a job market reason for not looking for work.

Question 20

Unemployment that exists because it takes time for workers to search for the job that suits them best is

Accepted Answer

A) frictional unemployment, which partly accounts for the natural rate of unemployment. 
B) frictional unemployment, which does not help account for the natural rate of unemployment. 
C) structural unemployment, which partly accounts for the natural rate of unemployment. 
D) structural unemployment, which does not help account for the natural rate of unemployment.

Exam 28: Unemployment