Macro. Chapter 28

A typical American worker covered by unemployment insurance receives _____ percent of his former wages for up to ________ weeks.

50, 26

An argument against the presence of unions is that the resulting allocation of labor ____

is inequitable.

The Bureau of Labor Statistics includes

those who worked in a family business without pay as employed and those waiting to be recalled to a job from which they have been laid off as unemployed.

Frictional unemployment can be the consequence of

workers leaving jobs to find ones that suit them better, firms going out of business, and firms firing workers.

The theory of efficiency wages explains why

firms may increase productivity and profits by setting wages above the equilibrium level.

One purpose of government sponsored job training is to reduce

frictional unemployment by giving workers skills to work in growing industries.

A wage above equilibrium

helps explain structural unemployment and the natural rate of unemployment

Suppose that coffehouse employees are not unionized. If they unionize, then the supply of labor in other sectors of the economy will

increase, reducing wages in industries that are not unionized.

If the minimum wage is above the equilibrium wage, then an increase in the minimum wage ______ the quantity of labor supplied and ______ the quantity of labor demanded.

increases, decreases

Refer to the figure. If unemployment is 4,000 workers, then the minimum wage must be

$8

The labor-force participation rate is computed as

(Labor Force / Adult Population) * 100.

Refer to the figure. If the government imposes a minimum wage of $9, then how many workers will be unemployed?

8,000

People who are unemployed because wages are, for some reason, set above the level that brings labor supply and demand into equilibrium are best classified as A frictionally unemployed. B cyclically unemployed. C structurally unemployed. D discouraged workers.

C structurally unemployed.

The unemployed who quit their jobs are eligible for unemployment insurance. True/Flase

False

The Bureau of Labor Statistics classifies some marginally attached workers as discouraged workers. What additional criteria has to be met for a marginally attached worker to be a discouraged worker?

She provides a job-market related reason for not looking for work.

According to 2012 data for U.S. teenagers (ages 16-19) ______ had the highest unemployment rate and _______ had the lowest unemployment rate.

black males, white females.

Clyde is the president of a firm that bottles beer in St. Louis, Missouri. There are many other such firms in the area. Clyde decides that if he pays his workers a wage higher than the going market wage, his profits will increase. Which of the following is a likely explanation for his decision?

The higher the wage, the less turnover in his work force.

Troy is looking for work after school, but everywhere he fills out an application, the managers say they always have a lot more applications than open positions. Ben has a business degree. Several companies have made him offers, but he thinks he might be able to find a job in a more desirable location.

Troy is structurally unemployed, and Ben is frictionally unemployed.

Which of the following is an example of an efficiency wage?

an above-equilibrium wage offered by a firm to attract a more talented pool of job applicants.

Which of the following includes everyone in the adult population that the Bureau of Labor Statistics counts as "unemployed?"

anyone who is not employed, is available for work, has looked for work in the past four weeks, and anyone who is waiting to be recalled from a job from which they have been laid off.

An argument against the presence of unions is that they ____

are essentially a cartel.

The natural rate of unemployment includes

both unemployment created by job search and unemployment created by above equilibrium wages.

If the natural rate of unemployment is 5 percent and the actual rate of unemployment is 5.5 percent, then by definition there is

cyclical unemployment amounting to 0.5 percent of the labor force.

Discouraged workers, as defined by the Bureau of Labor Statistics, are

excluded from both the number of unemployed and the labor force.

The U.S. minimum-wage laws has a large effect on the employment of workers with some basic skills and experience.

false

Sam quit his job because he wanted to move somewhere else. Amy just started looking for work after being out of the labor market for a couple of years. Mason was laid off because his employer's sales had fallen due to economic conditions. Who is currently eligible for unemployment insurance benefits?

only mason

Cyclical unemployment refers to

short-run fluctuations around the natural rate of unemployment.

The official government unemployment rate (U-3) fails to fully capture labor utilization because it does not capture

potential skill mismatches

Steve manages a warehouse where workers need to find, pack, and ship items ordered by online customers. He considers raising wages hoping that workers will spend more time doing their work and less time chatting with each other and checking their cellphones. According to efficiency wage theory if Steve decides to pay higher wages...

profits will rise but he will hire fewer workers.

Economists mostly agree that reducing unemployment benefits would

reduce unemployment, but there is disagreement about its effects on economic well-being.

Suppose that autoworkers are unionized. If autoworkers choose to abolish their union, then the quantity of autoworkers demanded will

rise. The supply of workers in other industries will fall.