ECO 110 Exam 2 Ch 11

A country has 50 million people, 30 million of whom are adults. Of the adults, 5 million are not interested in working, another 5 million are interested in working but have given up looking for work, and 5 million are still looking for work. Of those who do have jobs, 5 million are working part time but would like to work full time, and the remaining 10 million are working full time. How many people in this country are in the labor force?

20 million

A country has 50 million people, 30 million of whom are adults. Of the adults, 5 million are not interested in working, another 5 million are interested in working but have given up looking for work, and 5 million are still looking for work. Of those who do have jobs, 5 million are working part time but would like to work full time, and the remaining 10 million are working full time. What is this country's unemployment rate?

25%

(Table: Employment, Unemployment, and Labor Force Participation) Refer to the table. What is the unemployment rate of the country in 2010?

5%

(Figure: Labor Market) Refer to the figure. What is the unemployment rate in this market as a result of the implementation of a $10 minimum wage?

50%

(Figure: Labor Market) Refer to the figure. What is the number of people who are employed at the market wage? How many people end up unemployed due to the implementation of a $10 minimum wage?

60; 40

A country has 50 million people, 30 million of whom are adults. Of the adults, 5 million are not interested in working, another 5 million are interested in working but have given up looking for work, and 5 million are still looking for work. Of those who do have jobs, 5 million are working part time but would like to work full time, and the remaining 10 million are working full time. What is this country's labor force participation rate?

66.7%

(Table: Employment, Unemployment, and Labor Force Participation) Refer to the table. What is the labor force participation rate of this country in 2010?

76%

Which of the following is NOT true of structural unemployment?

It results from scarcity of information.

Which of the following is considered unemployed?

John, on temporary layoff from his work, awaits recall.

Which of the following would the BLS define as a discouraged worker?

Mary, who was laid off last year and who was looking for a full-time job until last month

Frictional unemployment is caused by:

creative destruction.

Which of the following is NOT part of natural unemployment?

cyclical unemployment

Unemployment correlated with the business cycle is called:

cyclical unemployment.

As the baby boomers retire, the United States labor force participation rate will:

decrease.

What affects labor force participation rates?

demographics, tax structure, and technological advances such as the birth control pill

Individuals who have given up looking for work but still would take a job are considered:

discouraged workers.

An unemployed person is one who:

does not have a job but is actively looking for one.

An unemployed person is best defined as an adult who:

does not have a job but is looking for work.

Which type of unemployment is an outcome of economist Joseph Schumpeter's "creative destruction" process within an industry?

frictional unemployment

Someone who recently moved to Florida because of its warmer climate will need to spend some time looking for a new job. This is an example of:

frictional unemployment.

Compared to the United States, unemployment rates in Western Europe tend to be:

higher because of more labor regulations.

Higher unemployment benefits tend to:

increase the unemployment rate.

During recessions the unemployment rate:

increases.

Minimum wage laws and unions tend to:

raise wages and raise unemployment.

One reason for an increased female labor force participation rate is that the birth control pill has:

reduced women's opportunity cost of working.

When workers lose their jobs and become officially unemployed, the labor force participation rate:

remains constant.

Frictional unemployment is best defined as:

short-term unemployment caused by difficulties of matching employees to employers.

Over the past few decades, the U.S. economy has switched from a primarily manufacturing economy to a service economy. Many individuals working in manufacturing positions lost their jobs, and many new jobs opened up in services. For those who lost jobs in manufacturing, this is an example of:

structural unemployment.

The persistent, long-term unemployment caused by long-lasting shocks or permanent features of an economy is called:

structural unemployment.

The presence of discouraged workers causes the measured unemployment rate to be:

understated.

A person is classified as unemployed only if he or she is:

willing and able to work but cannot find a job.

Discouraged workers and underemployed workers are examples of:

workers not included in the unemployment rate.