Practice Quiz Chapter 30

A country has 24 million people in the labor force, and 21.5 million of them are employed. What is the unemployment rate in this country?

10.4%

Higher GDP growth is generally associated with:

decreases in the unemployment rate.

Creative destruction occurs at the level of the:

firm, industry, and entire economy.

Active labor market policies:

focus on getting unemployed workers back to work.

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

reduced women's opportunity cost of working.

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%

A minimum wage is:

a labor market price floor.

According to the textbook, one major reason for the increase in the female labor force participation rate after World War II was:

an increase in the incentive to work.

Comparing current real GDP growth to _____ will give a good indication of the change in the unemployment rate.

average real GDP growth

How can people who are laid off from work due to a recession eventually turn into structurally unemployed people?

by staying unemployed so long that their skills become outdated

If the equilibrium wage is $9 in the market for hotel workers and $8 in the market for restaurant workers and both markets have similar elasticities of labor supply and demand, then a minimum wage of $10 in both markets will:

cause more unemployment among restaurant workers than hotel workers.

Structural unemployment is:

caused by long-lasting shocks or changes in permanent features of an economy.

Job-search programs and work tests for unemployed workers are likely to be sponsored by:

governments.

Countries in Western Europe have:

higher minimum wages, higher median wages, and higher unemployment than the United States.

Policies that encourage early retirement will most likely lead to:

higher tax rates for younger workers.

According to the Bureau of Labor Statistics, which of the following would be counted as unemployed?

new graduates who are looking for their first job

A discouraged worker is a:

person who has given up looking for work but would still like a job if one is available.

A worker repairing VHS cassette-tape players was laid off because most of his customers have started using DVD players and streaming services. This worker is now:

structurally unemployed.

Cyclical unemployment is:

unemployment correlated with the business cycle