ECON 102 exam 2 module 5

Which of the following can result in job rationing? i.minimum wage ii.union wage iii.diminishing returns

i and ii

Which of the following is TRUE? One way to be classified as employed is by i.working 1 hour per week at a paid job. ii. working 15 or more hours as an unpaid worker in a family business. iii. making specific efforts to find a job within the last four weeks.

i and ii only.

Which of the following increases frictional and/or structural unemployment? i.more young workers entering the labor force ii.more generous unemployment benefits iii.a structural slump with some industries dying

i, ii, and iii

The unemployment rate generally ________ during recessions and generally ________ during expansions.

increases; decreases

An efficiency wage

is set above the equilibrium real wage rate to induce greater work effort.

When the unemployment rate is greater than the natural unemployment rate, real GDP is

less than potential GDP.

To be considered unemployed, a worker must have had

no employment during the week before the survey and be actively looking for a job.

Frictional unemployment is the result of

normal labor market turnover.

France is considering implementing policies that will reduce the duration of job search. A possible option is for France to

reduce unemployment benefits.

After the passage of the North American Free Trade Agreement, which made it less expensive to import goods from Mexico, workers in some industries found their factories being relocated to Mexico to take advantage of lower labor costs. These workers experienced what type of unemployment?

structural

The total U.S. labor force participation rate increased over the past 50 years because

the female labor force participation rate increased.

The unemployment rate at full employment is

the natural unemployment rate.

In 2020, real GDP in the United States was below potential GDP. This fact definitely means that

the unemployment rate was above the natural unemployment rate.

At the peak of a business cycle, the

unemployment rate is below the natural unemployment rate.

Suppose the working-age population is 500 million, the labor force is 200 million, and the unemployment rate is 15 percent. The number of unemployed people is

30 million.

The unemployment that fluctuates over the business cycle is called

cyclical unemployment.

If half of all unemployed individuals suddenly gave up looking for work, the unemployment rate would ________ and the labor force participation rate would ________.

decrease; decrease

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 labor force participation rate to ________.

decrease; decrease

Full employment occurs when

the cyclical unemployment rate is zero.

Assume the U.S. population is 300 million. If the working age population is 240 million, 150 million are employed, and 6 million are unemployed, what is the labor force?

156 million

The highest unemployment rate in U.S. history was about

25 percent in 1933.

Which of the following persons is NOTconsidered a part of the labor force?

Desire, a wealthy hedge fund manager who just took early retirement

A newspaper headline reads "A New Wave of Workers Enters the Job Market!" This wave of young, new entrants to the labor market is likely to lead to

an increase in the natural unemployment rate.

Which of the following creates job rationing?

The real wage rate is above the equilibrium level.

Suppose the population of Timmy Town is 1,000 people and the working-age population is 800. If 200 of these people are unemployed, the unemployment rate in Timmy Town is

There is not enough information provided to calculate the unemployment rate.

Structural unemployment usually lasts ________ period of time ________ unemployment

a longer; than frictional

A marginally attached worker is

a worker who does not have a job and is available and wants one but has not made any efforts to find a job within the previous four weeks.

The working-age population consists of all the people in the population

aged 16 and over who are not in jail, hospital, or an institution or in the U.S. Armed Forces.

U-4, U-5 and U-6 are

all broader measures of the unemployment rate

The natural unemployment rate occurs

at the full employment level of unemployment.

When the unemployment rate is ________ the natural unemployment rate, real GDP is ________.

below; above potential GDP

Cyclical unemployment includes people who become unemployed from

changes in the business cycle.

During the Great Depression of the 1930s when the unemployment rate was exceptionally high due to the Great Depression, the government had employment programs, such as the Civilian Conservation Corps, which built campsites and planted trees. These programs were aimed at reducing which type of unemployment?

cyclical

The working-age population includes

employed and unemployed people over the age of 16.

Jane is a 25 year old, full-time student. She works part time in her school library and is paid

employed.

Potential GDP is the level of output produced when the unemployment rate is

equal to the natural unemployment rate.

Unemployment benefits in western Europe are more generous than in the United States. As a result, ________ in the United States.

frictional unemployment is lower

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

frictional unemployment.

Mary has decided that the she does not like Iowa and has decided to quit her job as a medical technician and move to Arizona. Mary's unemployment as she searches for a new job is best classified as

frictional.

Bill just graduated with his degree in economics. Through Career Services he submitted his resume to several companies and he will visit them during the next two weeks. Bill is considered

frictionally unemployed.

Which of the following helps explain the increase in the U.S. labor 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

ii and iii

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.

ii only

Which of the following would be considered a marginally attached worker? i.Amy, who is working 20 hours per week at her father's business ii.Carl, who isn't working and has not looked for work in 3 months because he has been turned down for work when he last looked iii.Keke, who quit her job to take care of her daughter

ii only

Discouraged workers are included in the calculation of the i.unemployment rate. ii.labor force participation rate. iii.working-age population.

iii only

The natural unemployment rate

includes only frictional and structural unemployment.

An increase in unemployment benefits ________ and an increase in international competition that changes the location of jobs ________.

increases frictional unemployment; increases structural unemployment

If Jose is 22-years old, is 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 Current Population Survey as

not in the labor force.

Phillip is a 22-year old who has no job and is available for work, but has not actively looked for a job in the last month. The Current Population Survey identifies Phillip as ________, ________ the labor force, and ________ the working-age population.

not unemployed; not part of; part of

Producing an amount of GDP equal to potential GDP is most consistent with the economy producing

on the production possibilities frontier.

After graduating from college, 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 Current Population Survey, Yunis is considered

part of the labor force and employed.

Which type of unemployment arises when changes in technology or international competition change the skills needed to perform jobs or change the location of jobs?

structural

After 15 years with Ford Motor Corporation, one summer Cameron loses his job. His boss explained that his position has been downsized after the technological advances in automobile production. Cameron is best considered

structurally unemployed.

Juan recently lost his jobas a travel agent, which he has had for 20 years, because the demand for his services has fallen over time as more and more people book their vacations 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

structurally unemployed.

At full employment there still exists some unemployment because

the U.S. economy is constantly creating and destroying jobs.