Macro-Economics CHP 19,20,21,22
All of the following are problems in measuring the unemployment rate, except that A. People on active military service are included as unemployed. B. lack of verification of people's responses in the household survey. C. discouraged workers are not included in the labor force. D. part-time workers are included as employed.
A. People on active military service are included as unemployed
Workers who lose their jobs because of a recession are experiencing
Cyclical
Unemployment caused by an increase in job quits would be classified as
Frictional
When the economy is at full employment, what types of unemployment remain?
Frictional and Structural
The employment-population ratio measures the
It measures the percentage of the working-age population that is employed. EPR= Employment/Working age population
When the economy is at full employment, unemployment is equal to
Natural Rate of Unemployment
Relationship between frictional unemployment and Job Search
People are said to be frictionally unemployed when they are between jobs and searching for new jobs
The type of unemployment most likely to result in hardship for the people who are unemployed is
Structural unemployment: Long term unemployment as workers look for ways to gain new job skills
natural rate of unemployment
The sum of structural unemployment and frictional unemployment
If someone worked only an hour per week during the previous week
They are NOT consider unemployed
When there are part-time workers , the official BLS measure of the unemployment rate ---------- the true degree of unemployment.
Understates
When there are workers that drop out of the labor force, the official BLS measure of the unemployment rate is-----the true degree of unemployment
Understates
When an unemployed person drops out of the labor force, it
does not affect the employment-population ratio
The short-term unemployment that arises from the process of matching workers with jobs is called
frictional unemployment.
Three types of unemployment are
frictional, structural, cyclical
Establishment Survey
interviews businesses and measures total employment in the economy.
Household Survey
interviews households and collects data that is used to measure the unemployment rate
Unemployment arising from a persistent mismatch between the skills and characteristics of workers and the requirements of jobs is called
structural unemployment.
The "normal" underlying level of unemployment in the economy is
the natural rate of unemployment. the full-employment rate of unemployment. the sum of structural unemployment and frictional unemployment.
The labor force participation rate is calculated by
the percentage of the working-age population that is in the labor force or Labor force/working−age population×100.
When an unemployed person drops out of the labor force, the unemployment rate
understates the true degree of joblessness in the economy
The unemployment rate is calculated as follows:
unemployment rate = number of unemployed/labor force x 100