Question 1

Sam just lost his job,but isn't yet looking for a new one.Sam is

Accepted Answer

A) counted as unemployed and part of the labor force. 
B) counted as unemployed, but not part of the labor force. 
C) not counted as unemployed, but counted as part of the labor force. 
D) not counted as unemployed or counted as part of the labor force. 
A) counted as unemployed and part of the labor force. 
B) counted as unemployed, but not part of the labor force. 
C) not counted as unemployed, but counted as part of the labor force. 
D) not counted as unemployed or counted as part of the labor force. D

Question 2

The labor force

Accepted Answer

A) equals the number of people employed. 
B) equals the number of people employed plus the number of people unemployed. 
C) equals the non-institutionalized adult population. 
D) equals the number of people employed plus the number of people cyclically unemployed. 
A) equals the number of people employed. 
B) equals the number of people employed plus the number of people unemployed. 
C) equals the non-institutionalized adult population. 
D) equals the number of people employed plus the number of people cyclically unemployed. B

Question 3

Following the recession of 2001 there was a month where employment and the unemployment rate rose.Assuming the computations were correct,how is it possible for both to have increased?

Accepted Answer

The rate of unemployment is measured as the number of people unemployed divided by the labor force.If the number of people in the labor force rises,but a significant portion of the rise in the labor force is people who are unemployed,then both employment and unemployment could rise.
(This likely happened because as the economy was improving,more people began seeking employment,but not all immediately found employment.)

Question 4

Latoya,an unpaid homemaker who works as a volunteer at the local Red Cross and is currently not looking for a paid job,is counted as

Accepted Answer

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

Question 5

Unions

Accepted Answer

A) do not increase the natural rate of unemployment. 
B) do not raise the wages of workers in the union. 
C) raise the profits of firms they work for. 
D) cause wages of nonunionized workers to fall. 
A) do not increase the natural rate of unemployment. 
B) do not raise the wages of workers in the union. 
C) raise the profits of firms they work for. 
D) cause wages of nonunionized workers to fall.

Question 6

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 female unemployment rate in Meditor?

Accepted Answer

A) 4.76% 
B) 7.14% 
C) 7.69% 
D) 14.29% 
A) 4.76% 
B) 7.14% 
C) 7.69% 
D) 14.29%

Question 7

Matt loses his job and decides to sit on the beach rather than looking for work the next few months.Other things the same,the unemployment rate

Accepted Answer

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

Question 8

Arnnie is the owner of a firm that produces bottled water in Washington state.There are many other such firms in the area.Arnnie decides that if he pays his workers a wage higher than the going market wage,his profits will increase.Which of the following is a likely explanation for his decision?

Accepted Answer

A) The higher the wage, the less often his workers will choose to leave his firm. 
B) The higher the wage, the lower will be the cost of obtaining needed supplies. 
C) The higher the wage, the more he can charge for his water. 
D) All of the above are likely explanations for Arnnie's decision. 
A) The higher the wage, the less often his workers will choose to leave his firm. 
B) The higher the wage, the lower will be the cost of obtaining needed supplies. 
C) The higher the wage, the more he can charge for his water. 
D) All of the above are likely explanations for Arnnie's decision.

Question 9

In the United States,blacks and whites have similar labor force participation rates,but blacks have a higher unemployment rate.

Accepted Answer

A) True 
 B)False

Question 10

More generous unemployment insurance would

Accepted Answer

A) raise structural unemployment. 
B) raise frictional unemployment. 
C) lower structural unemployment. 
D) lower frictional unemployment. 
A) raise structural unemployment. 
B) raise frictional unemployment. 
C) lower structural unemployment. 
D) lower frictional unemployment.

Question 11

Data on unemployment is reported

Accepted Answer

A) weekly. 
B) monthly. 
C) quarterly. 
D) yearly. 
A) weekly. 
B) monthly. 
C) quarterly. 
D) yearly.

Question 12

In Sweden and Denmark,the percentage of the workers who belong to unions is

Accepted Answer

A) almost zero. 
B) about the same as in the United States. 
C) a bit greater than in the United States. 
D) much greater than in the United States. 
A) almost zero. 
B) about the same as in the United States. 
C) a bit greater than in the United States. 
D) much greater than in the United States.

Question 13

Frictional unemployment is different from unemployment arising from minimum-wage laws,unions,and efficiency wages because in the former,workers are searching for the jobs that best suit them,while in the latter,workers are waiting for jobs to open up.

Accepted Answer

A) True 
 B)False

Question 14

Suppose that in some state the adult population is 4 million,the labor-force participation rate is 75%,and that .25 million people are unemployed.What is the unemployment rate to the nearest tenth?

Accepted Answer

A) 6.3% 
B) 7.7% 
C) 8.3% 
D) 9.1% 
A) 6.3% 
B) 7.7% 
C) 8.3% 
D) 9.1%

Question 15

The BLS reported in 2005 that there were 28.19 million people over age 25 who had no high school degree or its equivalent.In this group 11.73 million were employed and 1.04 million were unemployed.About what were the labor-force participation rate and the unemployment rate for this group?

Accepted Answer

A) 41.6% and 3.7% 
B) 41.6% and 3.% 
C) 45.3% and 8.1% 
D) 45.% and 8.% 
A) 41.6% and 3.7% 
B) 41.6% and 3.% 
C) 45.3% and 8.1% 
D) 45.% and 8.%

Question 16

Use the graph below to answer the following questions.
Figure 28-2
  
-Refer to Figure 28-2.If the minimum wage rose from $5 to $7,unemployment would

Accepted Answer

A) rise by 40. 
B) rise by 20. 
C) fall by 20. 
D) fall by 40. 
A) rise by 40. 
B) rise by 20. 
C) fall by 20. 
D) fall by 40.

Question 17

Why have labor-force participation rates for women in the United States increased since World War II while labor-force participation rates for men have decreased?

Accepted Answer

Labor-force participation rates for wome

Question 18

Marginally attached workers are people who

Accepted Answer

A) are looking for a better job than they currently have. 
B) are not working and are not looking for work, but would work if asked. 
C) are working part-time while they go to school or get training for a better job. 
D) are only a few years from retirement. 
A) are looking for a better job than they currently have. 
B) are not working and are not looking for work, but would work if asked. 
C) are working part-time while they go to school or get training for a better job. 
D) are only a few years from retirement.

Question 19

Use the following table to answer the following questions.
Table 28-1
  
-Refer to Table 28-1.What is the U-5 measure of labor underutilization?

Accepted Answer

A) 7.0 percent 
B) 7.95 percent 
C) 8.1 percent 
D) 9.2 percent 
A) 7.0 percent 
B) 7.95 percent 
C) 8.1 percent 
D) 9.2 percent

Question 20

The theory of efficiency wages explains why

Accepted Answer

A) setting wages at the equilibrium level may increase unemployment. 
B) it may be in the best interest of firms to offer wages that are above the equilibrium level. 
C) the most efficient way to pay workers is to pay them according to their skills. 
D) it is efficient for firms to set wages at the equilibrium level. 
A) setting wages at the equilibrium level may increase unemployment. 
B) it may be in the best interest of firms to offer wages that are above the equilibrium level. 
C) the most efficient way to pay workers is to pay them according to their skills. 
D) it is efficient for firms to set wages at the equilibrium level.

Exam 28: Unemployment

Sam just lost his job,but isn't yet looking for a new one.Sam is

The labor force

Following the recession of 2001 there was a month where employment and the unemployment rate rose.Assuming the computations were correct,how is it possible for both to have increased?

Latoya,an unpaid homemaker who works as a volunteer at the local Red Cross and is currently not looking for a paid job,is counted as

Unions

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 female unemployment rate in Meditor?

Matt loses his job and decides to sit on the beach rather than looking for work the next few months.Other things the same,the unemployment rate

Arnnie is the owner of a firm that produces bottled water in Washington state.There are many other such firms in the area.Arnnie decides that if he pays his workers a wage higher than the going market wage,his profits will increase.Which of the following is a likely explanation for his decision?

In the United States,blacks and whites have similar labor force participation rates,but blacks have a higher unemployment rate.

More generous unemployment insurance would

Data on unemployment is reported

In Sweden and Denmark,the percentage of the workers who belong to unions is

Frictional unemployment is different from unemployment arising from minimum-wage laws,unions,and efficiency wages because in the former,workers are searching for the jobs that best suit them,while in the latter,workers are waiting for jobs to open up.

Suppose that in some state the adult population is 4 million,the labor-force participation rate is 75%,and that .25 million people are unemployed.What is the unemployment rate to the nearest tenth?

The BLS reported in 2005 that there were 28.19 million people over age 25 who had no high school degree or its equivalent.In this group 11.73 million were employed and 1.04 million were unemployed.About what were the labor-force participation rate and the unemployment rate for this group?

Use the graph below to answer the following questions. Figure 28-2 -Refer to Figure 28-2.If the minimum wage rose from $5 to $7,unemployment would

Why have labor-force participation rates for women in the United States increased since World War II while labor-force participation rates for men have decreased?

Marginally attached workers are people who

Use the following table to answer the following questions. Table 28-1 -Refer to Table 28-1.What is the U-5 measure of labor underutilization?

The theory of efficiency wages explains why

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Applications

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

Oligopoly

Monopolistic Competition

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

Five Debates Over Macroeconomic Policy

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