chatpter 25

. Unions might increase efficiency in the case where they

offset the market power of a large firm that is the dominant employer in a region.

A minimum wage law tends to

create more unemployment in low-skill job markets than in high-skill job markets.

If the unemployment rate falls, we can be certain that more workers have jobs. F or T

False

If wages were always at the competitive equilibrium, there would be absolutely no unemployment. F or T

False

Sectoral shifts tend to raise which type of unemployment?

Frictional unemployment

4. Which one of the following types of unemployment results from the wage being held above the competitive equilibrium wage?

Structural unemployment

The natural rate of unemployment is the amount of unemployment that won't go away on its own, even in the long run. F or T

True

Unions may increase efficiency in some circumstances because they decrease the cost of bargaining between labour and management. F or T

True

Which of the following statements is true of the UK

a. Women tend to have broadly similar unemployment rates as men.

. Due to the existence of discouraged workers, the official unemployment rate may overstate true unemployment.

false

`. If wages were always at the competitive equilibrium, there would be absolutely no unemployment. tf

false

Unions tend to increase the disparity in pay between insiders and outsiders by

increasing the wage in the unionized sector, which may create an increase in the supply of workers in the non-unionized sector.

A miner who has been unable to find work for so long that he has stopped looking for work is considered to be

not in the labour force.

Whenever the wage rises above the competitive equilibrium, regardless of the source, the result is additional unemployment.

t

If unemployment insurance were so generous that it paid laid off workers 95 per cent of their regular salary,

the official unemployment rate would probably overstate true unemployment

If unemployment insurance were so generous that it paid laid off workers 95 per cent of their regular salary,

the official unemployment rate would probably overstate true unemployment.

If, for any reason, the wage is held above the competitive equilibrium wage,

the quantity of labour supplied will exceed the quantity of labour demanded and there will be unemployment.

Unions may increase efficiency in some circumstances because they decrease the cost of bargaining between labour and management. F or T

true