Econ Chapter 15

Which of the following is not a reason economies experience structural unemployment?

job search

A firm may pay efficiency wages in an attempt to

a. reduce incentives to shirk. b. reduce turnover. c. attract a well-qualified pool of applicants

Suppose some country had an adult population of about 50 million, a labor-force participation rate of 60 percent, and an unemployment rate of 5 percent. How many people were employed?

28.5 million

Suppose that the adult population is 6 million, the number of employed is 3.8 million, and the labor-force participation rate is 70%. What is the unemployment rate?

9.5%

An increase in the minimum wage

increases structural unemployment

The Bureau of Labor Statistics produces data on unemployment and other aspects of the labor market from a regular survey of households, called the

Current Population Survey.

The Bureau of Labor Statistics places people in the "employed" category if they

a. are temporarily absent from their jobs. b. are self-employed. c. work without pay in a family member's business.

. Which of the following causes of unemployment is associated with a wage rate above the market equilibrium level?

a. minimum-wage laws b. unions c. efficiency wages

Frictional unemployment can be the consequence of

a. workers leaving existing jobs to find ones they like better. b. one industry declining while another is growing. c. changes in the working conditions offered by competing firms.

Paying efficiency wages means that wages are

above equilibrium, and profits are higher than otherwise.

The labor-force participation rate is computed as

c. (Labor Force Adult Population) * 100.

Which of the following is a source of frictional unemployment?

changes in the composition of demand among industries or regions

The unemployment rate is computed as the number of unemployed

divided by the labor force, all times 100.

The theory of efficiency wages provides a possible explanation as to why

firms may be inclined to keep their workers' wages above the equilibrium level.

Which of the following is not a cause of frictional unemployment?

minimum-wage laws

Juanita decides to hire some additional workers for her vinyl siding factory. The equilibrium wage is $14 per hour. Efficiency wage theory suggests that it is reasonable for Juanita to offer

more than $14 per hour, so as to attract a better pool of applicants.

When a union raises the wage above the equilibrium level, it

raises the quantity of labor supplied and reduces the quantity of labor demanded.

Unemployment insurance

reduces search effort which raises unemployment

Frictional unemployment is inevitable because.

sectoral shifts are always happening.

Unions contribute to

structural unemployment

Efficiency wages create a labor

surplus and so increase unemployment.

Minimum wages create unemployment in markets where they create a

surplus of labor. Unemployment of this type is called structural.

Unemployment data are collected

through a regular survey of about 60,000 households