ECO 111 HW 5
The table shows employment statistics for a fictional country. Use the information to answer the questions. Round your percentages to two decimal places. Employed: 5,905 Unemployed: 452 Not in the labor force: 571 What is the total labor force?
6357
True or False: Poorer countries have historically been responsible for the bulk of world carbon emissions because of poor technology and environmental regulations.
False
True or False: The key to prosperity in the 20th century is an economy rich in natural resources.
False
The government's direct role in the production of physical capital is primarily focused on
developing infrastructure
Individuals who want to work, but have given up searching for a job because of limited prospects, are known as
discouraged workers
The purpose of growth accounting is to
estimate the contribution each component of the aggregate production function makes to overall economic growth.
The natural rate of unemployment equals
frictional unemployment plus structural unemployment.
Eric is an experienced project manager who lost his job at a tech start-up because the company's product failed to become popular. He is confident he can get a new job and has already rejected a number of offers. Eric is facing
frictional unemployment.
Hamid has just graduated as a lawyer from an esteemed law school. He is confident of getting a job and has already refused a few lower‑paying jobs. Hamid is facing
frictional unemployment.
A doctor's knowledge about a new cancer treatment affects
human capital
An increase in the number of college graduates impacts
human capital
Classify each example as either relating to human capital, physical capital, or technology. An increase in adult literacy affects
human capital
More people graduating from culinary school affects
human capital
The government's direct role in creating human capital is primarily focused on
improving the education system
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. A large number of young people entering the labor force
increase
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. An increase in union membership
increase
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. Extra financial benefits for the unemployed
increase
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. Increasing the minimum wage
increase
Suppose a hypothetical economy is currently operating at point A on the per worker production function (PWPF) labeled PF1 in the accompanying graph. Which event could move the economy from point A to point B?
increase in the amount of capital
Suppose a hypothetical economy is currently operating at point A on the per worker production function (PWPF) labeled PF1 in the accompanying graph. Which event could shift the PWPF from PF1 to PF2, or from point A to point C?
technological advancement
A new cancer treatment affects
technology
New distribution techniques affect
technology
Who reports the official U.S. unemployment rate?
the U.S. Bureau of Labor Statistics
Which of the factors would decrease the rate of frictional unemployment?
the advent of the Internet, which makes finding available jobs easier
Individuals who are involuntarily working part‑time are considered
underemployed
By excluding the groups identified in the previous questions, the U.S. Bureau of Labor Statistics calculation methods
understate the true level of unemployment.
Determine whether each of the individuals is considered unemployed or not unemployed. Alex just turned 16 and started applying for jobs. He has not found a company that will hire him yet.
unemployed
Determine whether each of the individuals is considered unemployed or not unemployed. Erik volunteers for 10 hours per week at his children's school and does no other work. He sends his resume to 10 potential employers daily.
unemployed
can cause distortion to the tax system
unit of account costs
can reduce the quality of economic decisions
unit of account costs
causes difficulty in firms and individuals financial planning
unit of account costs
makes money a less reliable source of measurement
unit of account costs
Which of the choices is most directly related to cyclical unemployment?
recessions
True or False: Long-run economic growth is unlikely to be sustainable because of finite natural resources.
False
Profits of a large investment company
Is not an input
Governments play an indirect role in private savings and investment through
regulating the financial system
Refer to the hypothetical data in the table to answer the three questions. 2017: Nominal interest rate: 5%, Real interest rate: —, Inflation rate: 3% 2018: Nominal interest rate: 3%, Real interest rate: 5%, Inflation rate: — 2019: Nominal interest rate: —, Real interest rate: 3%, Inflation rate: 3% What was the inflation rate in 2018?
-2%
If instead the growth rate is 7%, the doubling time for the economy is
10 years
True or False: In the modern economy, countries that possess few domestic natural resources essentially have no chance to develop economically.
False
Suppose the civilian non-institutionalized working-age population is 35.9 million in a hypothetical economy. Of these, 4.6 million are working part-time and 15.71 million are working full-time. Assume the Bureau of Labor Statistics (BLS) definitions are used for calculating unemployment data. Among those not working, the most recent job-search activity for 3.20 million happened less than two weeks ago, while 1.72 million most recently looked for work between two and four weeks ago. An additional 0.86 million most recently looked for work five weeks ago, and the remaining 9.81 million who do not have jobs have not looked for work in the past six weeks. Round your answers to two decimal places. What is the unemployment rate?
19.50%
Refer to the hypothetical data in the table to answer the three questions. 2017: Nominal interest rate: 5%, Real interest rate: —, Inflation rate: 3% 2018: Nominal interest rate: 3%, Real interest rate: 5%, Inflation rate: — 2019: Nominal interest rate: —, Real interest rate: 3%, Inflation rate: 3% What was the real interest rate in 2017?
2%
Suppose the civilian non-institutionalized working-age population is 35.9 million in a hypothetical economy. Of these, 4.6 million are working part-time and 15.71 million are working full-time. Assume the Bureau of Labor Statistics (BLS) definitions are used for calculating unemployment data. Among those not working, the most recent job-search activity for 3.20 million happened less than two weeks ago, while 1.72 million most recently looked for work between two and four weeks ago. An additional 0.86 million most recently looked for work five weeks ago, and the remaining 9.81 million who do not have jobs have not looked for work in the past six weeks. Round your answers to two decimal places. What is the size of the total labor force?
25.23 million
The table shows employment statistics for a fictional country. Use the information to answer the questions. Round your percentages to two decimal places. Employed: 5,905 Unemployed: 452 Not in the labor force: 571 Suppose 246 of the 452 unemployed people have been unemployed for so long that they stop looking for work. What is the new unemployment rate?
3.37%
The average rate of growth for slow-growth countries is around 2% per year, and for fast-growth, greater than 5% per year. Suppose the growth rate of the economy is 2%. The size of the economy roughly doubles every
35 years
Suppose the civilian non-institutionalized working-age population is 35.9 million in a hypothetical economy. Of these, 4.6 million are working part-time and 15.71 million are working full-time. Assume the Bureau of Labor Statistics (BLS) definitions are used for calculating unemployment data. Among those not working, the most recent job-search activity for 3.20 million happened less than two weeks ago, while 1.72 million most recently looked for work between two and four weeks ago. An additional 0.86 million most recently looked for work five weeks ago, and the remaining 9.81 million who do not have jobs have not looked for work in the past six weeks. Round your answers to two decimal places. How many people are unemployed?
4.92 milllion
Refer to the hypothetical data in the table to answer the three questions. 2017: Nominal interest rate: 5%, Real interest rate: —, Inflation rate: 3% 2018: Nominal interest rate: 3%, Real interest rate: 5%, Inflation rate: — 2019: Nominal interest rate: —, Real interest rate: 3%, Inflation rate: 3% What was the nominal interest rate in 2019?
6%
The table shows employment statistics for a fictional country. Use the information to answer the questions. Round your percentages to two decimal places. Employed: 5,905 Unemployed: 452 Not in the labor force: 571 What is the unemployment rate?
6.91%
The table shows employment statistics for a fictional country. Use the information to answer the questions. Round your percentages to two decimal places. Employed: 5,905 Unemployed: 452 Not in the labor force: 571 Suppose 246 of the 452 unemployed people have been unemployed for so long that they stop looking for work. What is the new labor force?
6111
Suppose the civilian non-institutionalized working-age population is 35.9 million in a hypothetical economy. Of these, 4.6 million are working part-time and 15.71 million are working full-time. Assume the Bureau of Labor Statistics (BLS) definitions are used for calculating unemployment data. Among those not working, the most recent job-search activity for 3.20 million happened less than two weeks ago, while 1.72 million most recently looked for work between two and four weeks ago. An additional 0.86 million most recently looked for work five weeks ago, and the remaining 9.81 million who do not have jobs have not looked for work in the past six weeks. Round your answers to two decimal places. What is the labor force participation rate?
70.28%
The table shows employment statistics for a fictional country. Use the information to answer the questions. Round your percentages to two decimal places. Employed: 5,905 Unemployed: 452 Not in the labor force: 571 Suppose 246 of the 452 unemployed people have been unemployed for so long that they stop looking for work. What is the new labor force participation rate?
88.21%
The table shows employment statistics for a fictional country. Use the information to answer the questions. Round your percentages to two decimal places. Employed: 5,905 Unemployed: 452 Not in the labor force: 571 What is the labor force participation rate?
91.76%
True or False: In the modern economy, human and physical capital are generally less important in productivity than natural resources.
False
True or False: Carbon emissions are negatively correlated with economic growth.
False
True or False: Human and physical capital are only beneficial to an economy when there is an abundance of natural resources in the economy.
False
A recent graduate with an engineering degree
Is an input
An upgrade of computers for Mikey's Motors
Is an input
Unskilled migrant worker from Latin America
Is an input
A decrease in property taxes
Is not an input
Bonds issued by an automaker
Is not an input
Contributions to Social Security
Is not an input
Which individual is out of the labor force?
James is without a job, is able to work, but is not actively looking for work.
Which of the statements best describes the idea of economic convergence?
Lower GDP per capita countries will catch up with higher GDP per capita countries.
Select the best definition of labor productivity
Output per worker
True or False: Air and water quality in developed countries is generally much better today than it was several decades ago.
True
True or False: All else equal, countries with more natural resources have a higher GDP per capita than those with few natural resources.
True
True or False: Finding alternatives to natural resources will be very important to long-term economic growth.
True
True or False: In the 19th century, countries with the highest per capita GDP were nearly always abundant in minerals and productive farming land.
True
True or False: Over the past two hundred years, improvements in productivity have offset lost productivity reduction due to less land being available.
True
True or False: Tackling climate change issues is likely only to modestly dent long-term economic growth.
True
True or False: When the economy is doing well, a significant share of unemployment is frictional.
True
discourages people from holding money
shoe leather costs
spending time converting money into something that better holds value
shoe leather costs
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. Reducing workers' collective bargaining rights
decrease
Craig lost his job several months ago. He is having a hard time finding a job that pays him more than unemployment insurance does. Craig is facing
structural unemployment.
The accompanying graph shows the labor market in the country of Harmonia. Assume that the Harmonia labor market is at the market equilibrium before the new minimum wage. The Harmonian government decides to introduce a minimum wage of $6. a. Show the new minimum wage on the graph by shifting the minimum wage line. b. What is the increase in unemployment as a result of the minimum wage? c. Which type of unemployment is affected by the new minimum wage?
a. The new minimum wage increases to $6, so move the horizontal line up. b. 40 Million c. Structural unemployment
James is an architect who has been laid off owing to a slump in the demand for property. He feels he will have to wait until the economy picks up before he can get a new job. James is facing
cyclical unemployment.
Sarah is a recent economics graduate who is entering a difficult labor market, due to a severe recession. She is continuing to look for work but is having a hard time getting interviews. Sarah is facing
cyclical unemployment.
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. An increase in information about job opportunities
decrease
Identify whether the actions or scenarios would likely increase or decrease the natural rate of unemployment. More funding for government worker training programs
decrease
A significant amount of oil discovered in Texas
is an input
Economic growth is important to understand because
it is closely tied to standard of living.
Any large, sustainable increase in real GDP must be due to steadily increasing
labor productivity
Determine if the people in the example have benefited - i.e., are winners - or have been harmed - i.e., are losers - by unexpected inflation. Herb, who keeps his savings in an old coffee can
loser
Determine if the people in the example have benefited - i.e., are winners - or have been harmed - i.e., are losers - by unexpected inflation. Karen, a retired school teacher who relies upon her fixed pension to pay for her expenses
loser
Determine if the people in the example have benefited - i.e., are winners - or have been harmed - i.e., are losers - by unexpected inflation. Third National, a bank that loaned many people money for home purchases
loser
This group, consisting of individuals who would like to work but have not looked for work during the past four weeks, is included among
marginally attached workers
can lead to stores listing prices in more stable currencies
menu costs
causes costs associated with changing prices in stores
menu costs
How frequently is the survey that determines unemployment released?
monthly
Determine whether each of the individuals is considered unemployed or not unemployed. James quit his job to stay at home with his children and has not worked in 15 years, nor has he looked for work.
not employed
Determine whether each of the individuals is considered unemployed or not unemployed. Laura works 20 hours in a paid position for her local animal shelter.
not employed
Determine whether each of the individuals is considered unemployed or not unemployed. Pete had a knee replacement two weeks ago and will not be available to work at his job as a mechanic for the next three months.
not employed
An increase in the number of company cars impacts
physical capital
An increase in the number of company computers affects
physical capital
When considering economic growth, many policy makers focus on real gross domestic product (GDP) per capita since it takes into account the potentially distorting effects of
population change
Determine if the people in the example have benefited - i.e., are winners - or have been harmed - i.e., are losers - by unexpected inflation. Joy, who borrowed $40,000 to pay for her college education
winner
Determine if the people in the example have benefited - i.e., are winners - or have been harmed - i.e., are losers - by unexpected inflation. The United States federal government, which had almost $15 trillion in debt in 2011
winner