Chapter 28

In the United States, unionized workers are paid about ___ percent more than similar nonunion workers.

15

Suppose that some country had an adult population of about 59 million, a labor-force participation rate of 72.9 percent, and an unemployment rate of 2.3 percent. How many people were employed?

42.0 million

According to the theory of efficiency wages

Firms may find it profitable to pay above-equilibrium wages

Providing training for unemployed individuals is primarily intended to reduce

Frictional unemployment

The main policy goal of unemployment insurance is to reduce the

Income uncertainty that workers face

In a competitive labor market, an increase in the minimum wage results in a(n) ___ in the quantity of labor supplied and a(n) ___ in the quantity of labor demanded.

Increase; decrease

Suppose that garbage collectors and landscaping workers have no unions. Now suppose that garbage collectors from unions. What does this do to the labor supply and wages of landscaping workers?

Labor supply increase, and wages decrease

Approximately what percent of U.S. workers are directly affected by the minimum wage?

1

How many n the sample are in the labor force?

10

The population of Ectenia is 100 people. 40 work full-time, 20 work half-time but would prefer to work full-time, 10 are looking for a job, 10 would like to work but are so discouraged that they have given up looking, 10 are not interested in working because they are full-time students, and 10 are retired. What is the number of unemployed?

10

What is the U-5 measure of labor underutilization

7.9%

Using the numbers in the preceding question, what is the size of Ectenia's labor force.

70

When a firm pays an efficiency wage, it may

Find that its workers quit less frequently

In many European nations, unions

Play a much larger role than they do in the United States

One unintended consequences of unemployment insurance is that it reduces the

Search effort of the unemployed

Suppose that a large number of people who used to work or seek work no longer do either. Other things the same, this makes

both the number of people unemployed and the labor force fall.