Question 1

The labor force participation rate:

Accepted Answer

A)   can be measured by dividing the total population by the proportion of people who want to work.
B)   tells us what fraction of the working-age population wants employment.
C)   typically increases during periods of recession.
D)   is measured by dividing the working-age population by the percentage of people employed.E) A) and D)
F) A) and C)

Question 2

Taxes have a(n)  _______ impact on the job-search effort.

Accepted Answer

A)   inconclusive
B)   negligible
C)   slightly positive
D)   slightly negativeE) A) and C)
F) A) and B)

Question 3

Sarah was a great bookkeeper 20 years ago, but she left the workforce to stay home and raise her children. Now that her kids are in college, Sarah is looking for another bookkeeping job, but they all require computer skills that she doesn't have. Sarah is:

Accepted Answer

A)   frictionally unemployed.
B)   structurally unemployed.
C)   not in the labor force.
D)   seasonally unemployed.E) All of the above
F) None of the above

Question 4

The BLS collects _______ measures of unemployment.

Accepted Answer

A)   four
B)   five
C)   six
D)   sevenE) A) and B)
F) None of the above

Question 5

Structural unemployment:

Accepted Answer

A)   occurs when there is a mismatch between the skills workers can offer and the skills that are in demand.
B)   is caused by workers changing their locations, jobs, or careers.
C)   is the effect of wages remaining persistently above the market-clearing level.
D)   occurs when workers voluntarily quit their jobs.E) A) and B)
F) A) and C)

Question 6

Supporters of minimum-wage legislation argue that:

Accepted Answer

A)   workers deserve a basic standard of living.
B)   the minimum wage should change in response to economic fluctuations.
C)   workers deserve consistent pay, regardless of skill level.
D)   All of these are arguments made by supporters of minimum-wage legislation.E) None of the above
F) C) and D)

Question 7

Efficiency wages are:

Accepted Answer

A)   deliberately set above the market rate to increase productivity.
B)   not a cause of unemployment.
C)   generally a disincentive for employees to work hard to try to keep their jobs.
D)   deliberately set at the equilibrium wage rate when legislation sets the minimum wage too high.E) B) and C)
F) None of the above

Question 8

The country of Hortonia enters into a massive free trade agreement that sends most manufacturing jobs overseas. The country's workers who were previously employed in manufacturing now face:

Accepted Answer

A)   frictional unemployment.
B)   real-wage unemployment.
C)   cyclical unemployment.
D)   structural unemployment.E) B) and D)
F) A) and D)

Question 9

The labor demand curve:

Accepted Answer

A)   shows the relationship between the total quantity of labor demanded by all the firms in the economy and the wage rate.
B)   shows that, all things being equal, firms will want to hire a constant amount of labor at each wage rate.
C)   shows the relationship between the total quantity of employment demanded by all the workers in the economy and the wage rate.
D)   has a positive slope.E) None of the above
F) B) and D)

Question 10

Which type of unemployment does not contribute to the natural rate of unemployment?

Accepted Answer

A)   Frictional
B)   Structural
C)   Real-wage
D)   CyclicalE) C) and D)
F) A) and C)

Question 11

Those who oppose minimum wage legislation argue that:

Accepted Answer

A)   setting a wage above the market-clearing equilibrium creates unemployment.
B)   the minimum wage should be set above the market-clearing equilibrium.
C)   the minimum wage should automatically increase with inflation.
D)   the minimum wage should be directed by executive order.E) None of the above
F) A) and B)

Question 12

If minimum wage legislation causes unemployment, then:

Accepted Answer

A)   workers who land or keep minimum wage jobs benefit.
B)   those who become unemployed lose.
C)   firms will not bear the entire burden of the higher cost of employment.
D)   All of these are true.E) None of the above
F) B) and D)

Question 13

What affect does unemployment insurance have on the labor market?

Accepted Answer

A)   It may decrease unemployment.
B)   It may affect how quickly people find jobs.
C)   It will never affect the natural rate of unemployment.
D)   It affects local markets only, as it is implemented differently by individual states.E) All of the above
F) A) and D)

Question 14

When the prevailing market wage is above equilibrium:

Accepted Answer

A)   there is no unemployment.
B)   there is a surplus of labor.
C)   the quantity of labor demanded is higher than the quantity supplied.
D)   All of these are true.E) All of the above
F) B) and C)

Question 15

The normal level of unemployment that persists in an economy in the long run is:

Accepted Answer

A)   the natural rate of unemployment.
B)   the equilibrium rate of underemployment.
C)   zero, as long as the market is equilibrium.
D)   zero with effective public policy.E) A) and B)
F) A) and C)

Exam 9: Unemploymentand the Labor Market

Those who oppose minimum wage legislation argue that:

Correct Answer
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Structural unemployment:

Correct Answer
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The labor demand curve:

Correct Answer
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If minimum wage legislation causes unemployment, then:

Correct Answer
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Efficiency wages are:

Correct Answer
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Which type of unemployment does not contribute to the natural rate of unemployment?

Correct Answer
verified

Sarah was a great bookkeeper 20 years ago, but she left the workforce to stay home and raise her children. Now that her kids are in college, Sarah is looking for another bookkeeping job, but they all require computer skills that she doesn't have. Sarah is:

Correct Answer
verified

The normal level of unemployment that persists in an economy in the long run is:

Correct Answer
verified

The country of Hortonia enters into a massive free trade agreement that sends most manufacturing jobs overseas. The country's workers who were previously employed in manufacturing now face:

Correct Answer
verified

Supporters of minimum-wage legislation argue that:

Correct Answer
verified

Taxes have a(n) _______ impact on the job-search effort.

Correct Answer
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When the prevailing market wage is above equilibrium:

Correct Answer
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The labor force participation rate:

Correct Answer
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What affect does unemployment insurance have on the labor market?

Correct Answer
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The BLS collects _______ measures of unemployment.

Correct Answer
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Exam 9: Unemploymentand the Labor Market

Those who oppose minimum wage legislation argue that:

Correct AnswerverifiedShow Answer

Structural unemployment:

Correct AnswerverifiedShow Answer

The labor demand curve:

Correct AnswerverifiedShow Answer

If minimum wage legislation causes unemployment, then:

Correct AnswerverifiedShow Answer

Efficiency wages are:

Correct AnswerverifiedShow Answer

Which type of unemployment does not contribute to the natural rate of unemployment?

Correct AnswerverifiedShow Answer

Sarah was a great bookkeeper 20 years ago, but she left the workforce to stay home and raise her children. Now that her kids are in college, Sarah is looking for another bookkeeping job, but they all require computer skills that she doesn't have. Sarah is:

Correct AnswerverifiedShow Answer

The normal level of unemployment that persists in an economy in the long run is:

Correct AnswerverifiedShow Answer

The country of Hortonia enters into a massive free trade agreement that sends most manufacturing jobs overseas. The country's workers who were previously employed in manufacturing now face:

Correct AnswerverifiedShow Answer

Supporters of minimum-wage legislation argue that:

Correct AnswerverifiedShow Answer

Taxes have a(n) _______ impact on the job-search effort.

Correct AnswerverifiedShow Answer

When the prevailing market wage is above equilibrium:

Correct AnswerverifiedShow Answer

The labor force participation rate:

Correct AnswerverifiedShow Answer

What affect does unemployment insurance have on the labor market?

Correct AnswerverifiedShow Answer

The BLS collects _______ measures of unemployment.

Correct AnswerverifiedShow Answer

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