Macroeconomics Chapter 28

In June 2014 the BLS reported an adult population of 234.9 million, a labor force of 154 million and employment of 141.6 million. Based on these numbers the unemployment rate was

12.4/154.

In June 2014 the BLS reported an adult population of 234.9 million, unemployment of 12.4 million, and employment of 141.6 million. Based on these numbers the labor force participation rate was

154/234.9.

Which of the following is an example of a reason why firms might pay efficiency wages?

All of these answers are true.

An American worker who becomes unemployed typically receives 100% of her former salary during the first six months she is unemployed.

False

The natural rate of unemployment refers to the current unemployment rate.

False

Jill does not currently have a job, but has applied for several jobs in the previous week. Ken is an unpaid stay-at-home dad who has not searched for work in recent years. Who does the BLS count as out of the labor force?

Ken but not Jill

Matt is waiting to be recalled to a job from which he was laid off. David was fired but hasn't looked for work during the last two months. Who does the BLS count as unemployed?

Matt but not David

Which of the following statements about efficiency wage theory istrue ?

Paying above the competitive equilibrium wage may improve worker health, lower worker turnover, improve worker quality, and increase worker effort.

Which of the following is correct?

People working part time are counted as employed by the BLS.

Which of the following is correct?

The labor force participation rate of women has increased in part due to smaller families.

If the number of people unemployed rose but the number of people employed and the adult population stayed the same, then the labor force participation rate would rise.

True

Minimum wage laws help explain the natural rate of unemployment if they create a surplus in any labor market.

True

An economist claims that changes in information technology and unemployment insurance have reduced unemployment. Which of these changes affect frictional unemployment?

both the changes in information technology and unemployment insurance

Which of the following is a source of frictional unemployment?

changes in the composition of demand among industries or regions

Efficiency wages

create a surplus of labor, and so raise unemployment.

A minimum-wage law tends to

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

Suppose that autoworkers are unionized in one region of the country but not in the other. If the unionized workers abolished their unions, employment

in that region would rise, but wages in that region would fall.

Sectoral shifts tend to raise which type of unemployment?

frictional unemployment

Which of the following isnot a characteristic of minimum-wage workers? They tend to be

full-time.

Efficiency wages

increase productivity but increase unemployment.

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 nonunionized sector.

Frictional unemployment results from

job searching. It is often thought to explain relatively short spells of unemployment.

Which of the following is true for the white population over 20?

males have the higher labor force participation rate; males and females have similar unemployment rates

According to the Bureau of Labor Statistics, a husband who chooses to stay home and take care of the household is

not in the labor force.

Unions might increase efficiency in the case where they

offset the market power of a large firm in a "company town."

Which of the following government policies would fail to lower the unemployment rate?

raise the minimum wage

Cyclical unemployment refers to

short-run fluctuations around the natural rate of unemployment.

Which of the following would the BLS count as unemployed?

someone on temporary layoff

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

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

Some frictional unemployment is inevitable because

there are changes in the demand for labor among different firms.