ECON CHAPTER 11

The table shows statistics for three Canadian cities at several different points in time. What was the number of unemployed people (in thousands) in Montreal in January 2009? 181.6 2,059.7 171.4 1,878.1

181.6

The hypothetical data in the table below displays the percentage that unemployment benefits replace take-home pay for workers in different countries. Note: The data cover a worker with a dependent spouse and are net rates after taking into account taxes and other means-tested benefits. Which country would you expect to have the lowest long-term unemployment rate? Italy Finland Australia Belgium

Australia

Which of the following persons would be considered unemployed? Nick, a union member on strike at his factory because he demands better job benefits. Beth, laid off from her job as a mechanic, chose to return to school instead of looking for another job. Jack, not having worked in eight months, feels hopeless, which is why he does not bother applying for jobs. None of the above are considered unemployed.

None of the above are considered unemployed.

Henry Ford's $5 per day wage is an example of: an efficiency wage. an equilibrium wage. a government regulated wage. a minimum wage law.

an efficiency wage.

Jonathan is currently enrolled in college full-time; however, he works part-time at a restaurant on weekends to earn some spending cash. Jonathan would be considered: a) unemployed b) employed c) not in the labor force d) institutionalized

employed

The natural unemployment rate is also known as the _____ unemployment rate. frictional structural cyclical long-run

long-run

Consider the graph of the labor market shown here. If the government mandates a minimum wage of $25, there is a labor: surplus of 6,000 workers. surplus of 2,000 workers. surplus of 4,000 workers. shortage of 2,000 workers.

surplus of 6,000 workers.

If the frictional rate of unemployment is 1.45%, the structural rate of unemployment is 2.3%, and the total unemployment rate is 6%, then we can conclude that: the economy is experiencing an economic boom. the labor force participation rate has fallen significantly. the natural (long-run equilibrium) rate of unemployment is 3.75%. there is 2.25% actual unemployment.

the natural (long-run equilibrium) rate of unemployment is 3.75%.

An underemployed person is one who is: working but whose skills are not fully utilized. retired or outside of the labor force. cyclically unemployed. employed in the underground economy.

working but whose skills are not fully utilized.

Suppose a labor market is described by the demand equation, Qd = 60 - 2w, and the supply equation, Qs = -10 + w, where Qd is the quantity demanded of labor (in Million), Qs is the quantity supplied of labor (in Million), and w is the wage (in dollars). What is the equilibrium wage in this labor market? $60 $23.33 $70 $33.33

$23.33

Suppose a labor market is described by the demand equation, Qd = 60 - 2w, and the supply equation, Qs = -10 + w, where Qd is the quantity demanded of labor (in Million), Qs is the quantity supplied of labor (in Million), and w is the wage (in dollars). If the government institutes a minimum wage of $25, how many workers will be unemployed in this market? 5,000,000 15,000,000 20,000,000 10,000,000

10,000,000

Suppose a labor market is described by the demand equation, Qd = 60 - 2w, and the supply equation, Qs = -10 + w, where Qd is the quantity demanded of labor (in Million), Qs is the quantity supplied of labor (in Million), and w is the wage (in dollars). If the government institutes a minimum wage of $25, how many workers will be willing to work in this market? 20,000,000 15,000,000 5,000,000 10,000,000

15,000,000

The table shows statistics for three Canadian cities at several different points in time. What was the number of people (in thousands) in Montreal's labor force in January 2005? 171.4 2,003.1 2,888.8 1,831.7

2,003.1

In May 2019, there were approximately 68,980,000 people in Japan's labor force. About 1,650,000 people were unemployed. What was the unemployment rate? 5.0% 1.8% 6.1% 2.4%

2.4%

The table shows statistics for three Canadian cities at several different points in time. What was the number of unemployed people (in thousands) in Toronto in January 2019? 3,405.3 250.9 234.2 3,639.5

234.2

In May 2019, Texas reported a civilian labor force of 14,012,711. The number of employed people was 13,516,387. What was the unemployment rate? 96.5% 4.9% 5.3% 3.5%

3.5%

Refer to the following table that shows monthly data for Japan. What was the unemployment rate in January 2014? 2.8% 3.3% 3% 3.7%

3.7%

If the village of Happyville has 150 residents, of which 50 are children or senior citizens, 95 are working, and 5 are actively seeking work, the unemployment rate is: 36.7%. 5%. 33.3%. 3.3%.

5

Suppose that in Southlandia, frictional unemployment is 2%, structural unemployment is 3%, and cyclical unemployment is 4%. What is the natural rate of unemployment in Southlandia? a) 2% b) 3% c) 5% d) 9%

5

The table shows statistics for three Canadian cities at several different points in time. What was the unemployment rate in Montreal in January 2019? 8.8% 6.2% 5.4% 93.8%

6.2%

Which of the following persons would be considered employed? Sam, a 12 year old who helps his mom stock shelves at her gift shop. Ron, a recently enrolled full-time college student in hopes of finding a well-paying job. Jennifer, a teacher who is on two-month maternity leave but will return to work. All of the above persons are considered employed.

Jennifer, a teacher who is on two-month maternity leave but will return to work.

You have four friends. Which of your friends can be described as "cyclically unemployed"? Martha, who is a full-time stay-at-home paren t Arthur, who quit his job to look for a better job Regan, who is in a nursing home Keele, who lost her job after her company lost a lot of customers during an economic downturn

Keele, who lost her job after her company lost a lot of customers during an economic downturn

Suppose that due to a poor economy, 1 million workers lost their jobs, causing the unemployment rate to increase to 10%. After a few months of searching, 300,000 of these unemployed workers give up looking for work. How would the decision by these 300,000 people affect the unemployment rate, all else equal? The unemployment rate would remain unchanged. The unemployment rate would decrease. The unemployment rate would increase. There is not enough information to answer this question.

The unemployment rate would decrease.

Chelsea was a manager at a vinyl records store who recently quit because she felt the recent popularity of vinyl is a current fad that will eventually fade away. She is now actively looking for a job in the hospitality industry. Chelsea is considered: not in the labor force. cyclically unemployed. frictionally unemployed. structurally unemployed.

frictionally unemployed.

Consider these four graphs of the labor market, showing four different minimum wage levels. Which graph(s) shows a wage level where there is no unemployment? graphs A and C graph B graph D graphs B and C graphs A and D

graph B

The higher the minimum wage, as compared to the equilibrium wage, the: higher the cyclical unemployment rate. lower the structural unemployment rate. lower the natural rate of unemployment. higher the structural unemployment rate.

higher the structural unemployment rate.

Consider the labor market shown here. If an efficiency wage of $14 is instituted in this market, the number of workers willing to work will: increase by 2,000. decrease by 2,000. increase by 4,000. decrease by 4,000

increase by 2,000.