Deck 6: Jobs and Unemployment

Question 1

A weakness that could be noted about the unemployment rate is that it

A) considers marginally attached workers as unemployed.
B) does not count part-time workers.
C) overestimates the number of part-time workers.
D) counts discouraged workers as employed.
E) does not account for the underutilisation of workers.

Answer 1

does not account for the underutilisation of workers.

Question 2

Who of the following would be classified as employed in the Labour Force Survey?

A) April, who just graduated from university and is looking for work.
B) Richard, who is working 20 hours a week but wants a full-time job.
C) Misty, who just quit her job to return full-time to school.
D) Laura, who is unpaid but is working 10 hours a week in the family business.
E) Jason, who was laid off from work less than 6 months ago but who has stopped looking for work.

Answer 2

Richard, who is working 20 hours a week but wants a full-time job.

Question 3

The working-age population includes

A) those in jails and hospitals.
B) the total number of civilians aged 15 years and over.
C) people over the age of 15 who are working and those under the age of 65.
D) youngsters between the ages of 14 and 16 if they are working at least part-time.
E) only employed people over the age of 15.

Answer 3

the total number of civilians aged 15 years and over.

Question 4

Suppose the working-age population is 50 million, the labour force is 20 million, and the unemployment rate is 15 per cent. The number of unemployed people is

A) 4.5 million.
B) 10.5 million.
C) 7.5 million.
D) 1.5 million.
E) 3 million.

Question 5

In January of 2019, the number of employed persons in Australia was 11.7 million, the number of unemployed persons was 0.8 million, and the number of persons not in the labour force was 6.7 million. What was the working-age population in January of 2019?

A) 19.2.0 million
B) 15.5 million
C) 18.7 million
D) 10.8 million
E) There is not enough information to answer this question.

Question 6

If a significant number of part-time workers successfully find full-time employment, then

A) the unemployment rate will fall.
B) the labour force participation rate will increase.
C) the unemployment rate will remain unchanged.
D) the unemployment rate will rise.
E) Both answers A and B are correct.

Question 7

Which of the following persons is NOT considered a part of the labour force?

A) Mary, who has a part-time job as a day care specialist.
B) Kurt, an unemployed mechanic looking for a new job.
C) Brittany, a wealthy hedge fund manager who has just taken early retirement.
D) Jameson, an accountant who has been temporarily laid off during the holiday season.
E) Lucy, who works 20 hours a week in her father's restaurant for no pay.

Question 8

In January 2019, the population of Australia was 23.7 million, the working-age population was 19.2 million, the total number of people employed and unemployed was 12.5 million, and the total number of unemployed people was 0.8 million. What is the unemployment rate?

A) 6.4 per cent
B) 51 per cent
C) 4.9 per cent
D) 9.5 per cent
E) 6.2 per cent

Question 9

If Jose is 22-years old and available to work but does not have a job and made no specific efforts to find a job for the previous month, Jose is classified in the Labour Force Survey as

A) not in the labour force.
B) employed.
C) unemployed.
D) in the labour force but not in the working-age population.
E) not in the working-age population.

Question 10

The labour force includes civilians who
i. are less than 15 years of age.
ii. are employed.
iii. are actively seeking a job but do not have a job.

A) i only
B) ii and iii
C) i and iii
D) i and ii
E) i, ii and iii

Question 11

In January of 2019, the population of Australia was 23.7 million, the working-age population was 19.2 million, the total number of people employed was 11.7 million, and the total number of people unemployed was 0.8 million. What was the labour force participation rate?

A) 90 per cent
B) 78 per cent
C) 56 per cent
D) 67 per cent
E) 65 per cent

Question 12

After graduating from university, Yunis, age 22, started working for his parents' real estate business as an unpaid assistant. He works 25 hours a week helping manage rental units. In the Labour Force Survey, Yunis is considered

A) part of the labour force and employed.
B) not part of the labour force.
C) a discouraged worker.
D) part of the labour force and unemployed.
E) part of the labour force but not part of the working-age population.

Question 13

Assume the Australian population is 30 million. If 20 million people are of working age, 12.5 million are employed, and 1.5 million are unemployed, what is the size of the labour force?

A) 20 million
B) 14 million
C) 12.5 million
D) 17.5 million
E) 21.5 million

Question 14

Ashleigh is a 26-year old who works 25 hours per week at a local café but, because of unfavourable business conditions, cannot find full-time employment. The Labour Force Survey identifies Ashleigh as ________, ________ the labour force, and ________ the working-age population.

A) a discouraged job seeker; not part of; part of
B) unemployed; part of; part of
C) an underemployed worker; part of; part of
D) underemployed; part of; not part of
E) a discouraged job seeker; not part of; not part of

Question 15

The unemployment rate equals

A) (number of people unemployed ÷ labour force) × 100.
B) (number of people unemployed ÷ number of people employed) × 100.
C) (labour force ÷ working-age population) × 100.
D) (number of people employed ÷ number of people aged 15 and over) × 100.
E) (number of people employed ÷ working-age population) × 100.

Question 16

If the number of employed people is 15 million, the number of unemployed people is 5 million, and the working-age population equals 28.5 million people, the labour force participation rate is

A) 81 per cent.
B) 70.2 per cent.
C) 25 per cent.
D) 52.6 per cent.
E) 17.5 per cent.

Question 17

The Australian Bureau of Statistics (ABS) compiles information about employment by

A) performing a census of every household in the nation.
B) determining the average estimate of labour market specialists around the nation.
C) performing a monthly survey of 27,000 households.
D) performing a quarterly survey of 270,000 households.
E) None of the above.

Question 18

If Brian, age 24, had no job but was available for work and had looked for a job in the four weeks before the survey, Brian is classified in the Labour Force Survey as

A) not in the working-age population.
B) unemployed.
C) employed.
D) a discouraged worker.
E) not in the labour force.

Question 19

If the number of people in the labour force ________, then ________.

A) increases; the unemployment rate definitely increases
B) decreases; the labour force participation rate increases
C) decreases, the unemployment rate does not change
D) decreases; the unemployment rate definitely decreases
E) increases; the labour force participation rate increases

Question 20

A marginally attached worker is

A) someone who does not have a job but is available and willing to work and has made specific but unsuccessful efforts to find a job during the past 4 weeks.
B) another name for an unemployed worker.
C) a person who is not happy with his or her job.
D) someone who does not have a job, is available and willing to work but has not made specific efforts to find a job during the past 4 weeks.
E) someone who works part-time more than 25 hours per week but wants full-time work.

Question 21

The average unemployment rate in Australia between 1980 and 2018 is

A) 11.1 per cent.
B) 6.9 per cent.
C) 15.7 per cent.
D) 7.0 per cent.
E) 8.0 per cent.

Question 22

Andrew is not working, but is available and willing to work after finishing a month-long mission trip for his church. While on his mission, Andrew did not look for work. Andrew is considered

A) a marginally attached worker.
B) a discouraged job seeker.
C) part of the labour force.
D) unemployed.
E) Both answers A and B are correct.

Question 23

In Australia, from 1980 to 2018, the percentage of

A) voluntary part-time workers increased significantly to over 50 per cent of the workforce.
B) voluntary part-time workers increased.
C) underemployed workers fell during recessions and rose during expansions.
D) underemployed workers decreased.
E) None of the above answers is correct.

Question 24

The table above shows data reported by the Office for National Statistics for the United Kingdom in September 2000. In September 2000, the unemployment rate was

A) 3.7 per cent.
B) 3.5 per cent.
C) 5.5 per cent.
D) 1,619 thousand.
E) 5.8 per cent.

Question 25

Which of the following help explain the increase in the labour force participation rate for women?
i. There was a significant fall in the number of children women were choosing to have.
ii. There was an increase in the educational level of women.
iii. Technological change in the home increased the time available for work outside the home.

A) i only
B) ii only
C) i and ii
D) ii and iii
E) i, ii and iii

Question 26

The highest unemployment rate in recent Australian history was about

A) 7 per cent in 2001.
B) 11.1 per cent in 1992.
C) 10.2 per cent in 2009.
D) 16.2 per cent in 1982.
E) 4 per cent in 2008.

Question 27

The upward trend in the labour force participation rate over the past 25 years is explained by

A) the increase in the population.
B) the increase in the number of discouraged workers.
C) the increase in the male labour force participation rate.
D) the increase in the female labour force participation rate.
E) Both answers B and D are correct.

Question 28

People who are working up to 34 hours per week but would like to work more are considered

A) job leavers.
B) job seekers.
C) underemployed workers.
D) discouraged job seekers.
E) unemployed.

Question 29

Between 1980 and 2018, the labour force participation rate for men

A) did not change until 1992, after which it generally increased.
B) did not change.
C) fluctuated, first rising until about 1989 and falling after that.
D) increased in most years.
E) decreased in most years.

Question 30

During a recession the unemployment rate generally ________ and during an expansion the unemployment rate generally ________.

A) does not change; falls
B) falls; rises
C) rises; rises
D) rises; does not change
E) rises; falls

Question 31

People who are willing and able to work but are not looking for work because they have been discouraged by their previous futile efforts are called

A) involuntarily unemployed.
B) discouraged job seekers.
C) part-time lookers.
D) unhappy workers.
E) unemployed workers.

Question 32

Harry works at Coles for 20 hours per week. He's asked his boss to allow him to work 35 hours per week, but has been told that business is too slow. Harry is considered

A) a discouraged worker.
B) a marginally attached worker.
C) an underemployed worker.
D) a job seeker.
E) not in the labour force.

Question 33

During a recession, the unemployment rate

A) usually increases, but not necessarily to 10 per cent or 25 per cent.
B) usually decreases.
C) is, by definition, above 10 per cent.
D) is, by definition, above 25 per cent.
E) remains constant.

Question 34

Countries with higher than average unemployment rates have ________ compared to Australia.

A) a higher labour force participation rate
B) less regulated labour markets
C) lower levels of technology
D) higher levels of technology
E) more generous unemployment benefits and more regulated labour markets

Question 35

The table above shows data reported by the Office for National Statistics for the United Kingdom in September 2000. In September 2000, the labour force participation rate was

A) 40.3 per cent.
B) 34.8 per cent.
C) 58.3 per cent.
D) 63.1 per cent.
E) 59.7 per cent.

Question 36

Discouraged job seekers

A) are counted as unemployed workers when the unemployment rate is calculated.
B) are not included in the calculation of the unemployment rate, the labour force, or the working-age population.
C) would decrease the unemployment rate if they were added to the number of unemployed workers.
D) are counted as one-half of a worker in unemployment statistics.
E) would increase the unemployment rate if they were added to the number of unemployed workers.

Question 37

Julie works part-time as a result of unfavourable business conditions. She would be considered

A) a discouraged worker.
B) unemployed as calculated by the Australian Bureau of Statistics.
C) a job seeker.
D) not in the labour force.
E) an underemployed worker.

Question 38

The underutilisation rate and the extended underutililisation rate are

A) not used by the Australian Bureau of Statistics because they include too much variability.
B) broader measures of the labour force participation rate.
C) all narrower measures of the unemployment rate.
D) narrower measures of the labour force participation rate.
E) all broader measures of the unemployment rate.

Question 39

Since 1980, the labour force participation rate in Australia has

A) increased for women and not changed for men.
B) increased for men and women.
C) decreased for men and women.
D) increased for men and decreased for women.
E) increased for women and decreased for men.

Question 40

Rick lost his job as a logistics and distribution coordinator nearly three years ago. After a long and failed search, Rick finally gives up and stops looking for a new job. Rick's decision to suspend his job search causes the unemployment rate to ________ and the labour force participation rate to ________.

A) increase; increase
B) increase; stay the same
C) stay the same; decrease
D) increase; decrease
E) decrease; decrease

Question 41

When the automobile replaced horse-drawn carriages as the principal means of transportation, firms producing horse-drawn carriages went bankrupt and permanently laid off all their workers, thereby increasing
i. seasonal unemployment.
ii. structural unemployment.
iii. cyclical unemployment.

A) i only
B) ii only
C) i and ii
D) ii and iii
E) i and iii

Question 42

Juan recently lost his job as a travel agent, which he had for 20 years, because the demand for his services fell over time as more and more people booked their holidays online. Unfortunately, Juan has not been able to find a new job because he lacks the skills needed to get hired in other industries where job growth is occurring. Juan is considered to be

A) not in the labour force.
B) structurally unemployed.
C) a marginally attached worker.
D) cyclically unemployed.
E) frictionally unemployed.

Question 43

As firms search for the best employee to fill an opening and the unemployed search for the job that best fits their skills, the economy experiences

A) changes in the business cycle.
B) frictional unemployment.
C) avoidable unemployment.
D) cyclical unemployment.
E) structural unemployment.

Question 44

Jordan recently quit her job as a marketing consultant in Melbourne and is looking for a better-paying job with an advertising agency in Sydney. Jordan is considered to be

A) cyclically unemployed.
B) a discouraged worker.
C) frictionally unemployed.
D) not in the labour force.
E) structurally unemployed.

Question 45

Beth has just quit her job, moved to a new city, and is looking for a new job. Beth is

A) locationally unemployed.
B) frictionally unemployed.
C) structurally unemployed.
D) cyclically unemployed.
E) distance unemployed.

Question 46

During a recession, the average duration of unemployment tends to

A) be about the same as during an expansion.
B) decrease.
C) increase.
D) be unpredictable.
E) remain constant.

Question 47

At full employment there still exists some unemployment because

A) the Australian economy is constantly creating and destroying jobs.
B) it is unnatural to have all people work 35 hours per week.
C) there are always people too old or young to be in the labour force.
D) real GDP can never exceed potential GDP.
E) some portion of our population will always be too lazy to work.

Question 48

The average duration of unemployment

A) decreases during recessions and increases during expansions.
B) does not vary with the business cycle.
C) decreases all the time.
D) increases during recessions and decreases during expansions.
E) increases all the time.

Question 49

Full employment occurs when

A) frictional unemployment is zero.
B) cyclical unemployment is zero.
C) structural unemployment is zero.
D) the unemployment rate equals zero.
E) structural and frictional unemployment are zero.

Question 50

Cyclical unemployment is

A) higher when the economy is expanding.
B) the total of structural and frictional unemployment.
C) part of frictional unemployment.
D) created by a recession.
E) always greater than the total of structural and frictional unemployment.

Question 51

Two of the most important factors that influence the natural unemployment rate are

A) the level of cyclical unemployment and the age distribution of the population.
B) the real wage rate and the pace of structural change.
C) the age distribution of the population and the level of cyclical unemployment.
D) the output gap and the real wage rate.
E) the pace of structural change and the output gap.

Question 52

Cyclical unemployment includes people who become unemployed due to

A) changes in international competition.
B) changes in the seasons.
C) normal labour market turnover.
D) changes in the business cycle.
E) technological changes.

Question 53

John has been laid off from his job because of a general downturn in the economy. John's unemployment is best classified as

A) avoidable.
B) cyclical.
C) full.
D) structural.
E) frictional.

Question 54

Which type of unemployment is a permanent and healthy phenomenon in a dynamic economy?

A) Frictional
B) Avoidable
C) Unavoidable
D) Structural
E) Cyclical

Question 55

The natural unemployment rate is the unemployment rate that exists when there is no

A) frictional unemployment.
B) cyclical unemployment.
C) structural unemployment.
D) cyclical or structural unemployment.
E) unnecessary unemployment.

Question 56

The amount of frictional unemployment depends on

A) the phase of the business cycle.
B) international competition.
C) demographic factors and unemployment benefits.
D) the time of the year.
E) Both answers A and B are correct.

Question 57

The women's labour force participation rate is

A) higher in the United States than in Iceland or Norway.
B) higher in Australia than in Iceland.
C) higher in Australia than in the United States.
D) higher in Australia than in Italy.
E) higher in Spain than in Iceland.

Question 58

Full employment is the level of unemployment that occurs

A) when cyclical unemployment is zero.
B) when everyone looking for a job has a job.
C) when frictional and structural unemployment are zero.
D) when frictional, structural and cyclical unemployment are zero.
E) None of the above answers is correct.

Question 59

An employee who is fired from his or her job because he or she lacks the skills required to accomplish the task, is part of ________ unemployment.

A) cyclical
B) structural
C) unskilled
D) withdrawal
E) frictional

Question 60

Structural unemployment is the result of

A) voluntary job-quitting by workers.
B) downturns in the business cycle.
C) technological changes or foreign competition.
D) changing labour needs by firms during the year.
E) changes in the family structure.

Question 61

As the unemployment rate increases,

A) potential GDP increases.
B) real GDP decreases.
C) full employment GDP decreases.
D) both real GDP and potential GDP decrease.
E) potential GDP decreases.

Question 62

Who is cyclically unemployed?

A) Casey, who lost his job because the technology changed so he was no longer needed.
B) Samantha, who quit her job to return to university to earn her MBA.
C) David, a new car salesman who lost his job because the economy went into a recession.
D) Katrina, an assistant manager who quit her job to search for a better job closer to home.
E) Kathy, a toolmaker who was laid off but has stopped looking for a new job because she can't find a new job.

Question 63

The natural unemployment rate

A) is easy to measure.
B) includes only frictional and structural unemployment.
C) is equal to zero when there are no economic fluctuations.
D) is very stable in value across time.
E) includes some frictional, structural and cyclical unemployment.

Question 64

The natural unemployment rate is

A) the same for all industrialised countries.
B) equal to the sum of frictional, cyclical and seasonal unemployment.
C) equal to zero.
D) not known with certainty.
E) equal to the sum of frictional, structural and cyclical unemployment.

Question 65

If the federal government expands its support of education and retraining of workers who have been unemployed for a relatively long length of time, which type of unemployment would the education and retraining most likely target?

A) Cyclical
B) Government
C) Frictional
D) Discouraged
E) Structural

Question 66

If the unemployment rate is less than the natural unemployment rate, then

A) frictional unemployment is negative.
B) real GDP is less than potential GDP.
C) there is no frictional unemployment.
D) cyclical unemployment is greater than zero.
E) real GDP is greater than potential GDP.

Question 67

The natural unemployment rate occurs

A) when the structural unemployment rate equals zero.
B) when the unemployment rate equals zero.
C) when the frictional unemployment rate equals zero.
D) when the sum of frictional and structural unemployment equals zero.
E) at the full employment level of unemployment.

Question 68

During a recession,

A) real GDP is equal to potential GDP.
B) the actual unemployment rate is less than the natural unemployment rate.
C) the relationship between real GDP and potential GDP no longer exists.
D) real GDP is greater than potential GDP.
E) real GDP is less than potential GDP.

Question 69

Potential GDP is reached when

A) unemployment is zero.
B) there is no cyclical unemployment.
C) unemployment is above full employment.
D) the natural unemployment rate equals zero.
E) unemployment is below full employment.