Chapter 7 - Unemployment

Question 1

The highest amount of skilled and unskilled labor that could be employed within an economy at any given time

Answer 1

Full employment

Question 2

True or false: when there is full employment the number of jobseekers is approximately equal to the number of job vacancies

Answer 2

True

Question 3

True or false: during periods of recession and economy usually experiences a relatively high unemployment rate

Answer 3

True

Question 4

True or false: a recent college graduate who suddenly becomes available in the job market but has yet to find his first job is an example of cyclical unemployment

Answer 4

False

Question 5

I don’t work or maybe laid off during a recession this is an example of what kind of unemployment?

Answer 5

Cyclical

Question 6

Voluntary unemployment like a labor strike is an example of what kind of unemployment?

Answer 6

Frictional

Question 7

John completed his Masters degree and waited for three months to get selected by a company as an assistant project manager. This three-month period of unemployment is called what kind of unemployment?

Answer 7

Frictional

Question 8

What kind of unemployment occurs when available workers do not match the jobs available in terms of skills or location?

Answer 8

Structural

Question 9

People who lose their job in one industry often do not have the skills to immediately get a job in a new industry

Answer 9

Structural Shift

Question 10

What kind of unemployment occurs when workers are laid off because every fall into me and generally or specifically for the products they produce?

Answer 10

Cyclical

Question 11

True or false: macro economics policies intending to reduce cyclical unemployment try to create jobs by increasing demand for total output

Answer 11

True

Question 12

True or false: excess labor in Montana and a shortage of workers in Virginia is an example of structural unemployment

Answer 12

True

Question 13

A measure of economic performance that shows changes in output per worker hour from one year to the next

Answer 13

Productivity

Question 14

True or false. Unemployment allows for growth in the economy

Answer 14

True

Question 15

True or false. The system of income distribution in a market economy is not dependent on employment

Answer 15

False

Question 16

The policy of stealing employees away from jobs by offering them a higher salaries doesn’t lead to more production for the economy. Instead, this policy just rearrange is what is produced and leads to what?

Answer 16

Inflation

Question 17

True or false. Full employment means that everyone in the population is employed or even that 100% of those who are able are willing to take a job

Answer 17

False

Question 18

True or false. By definition and economy is at full employment with 93% to 94% of those who want to work are employed

Answer 18

True

Question 19

What happens to output when unemployment happens for extended periods of time and who loses

Answer 19

Output is below its potential level and society as a whole loses

Question 20

Costs of cyclical unemployment include?

Answer 20

output lost (economy not at full employment) and distributional impact (1% increase

Question 21

True or False: Unemployment benefits increase the rate of unemployment

Answer 21

True

Question 22

True or False: the replacement ratio creates less of an urgency for the unemployed to become employed

Answer 22

True

Question 23

What is replacement ratio?

Answer 23

after-tax income while unemployed to after tax income while employed

Question 24

True or False: Reducing minimum wage may be a way of reducing the teenage unemployment rate?

Answer 24

True

Question 25

The phenomenon that extended periods of high unemployment raise the natural is known as

Answer 25

unemployment hysteresis

Question 26

What are the determinants of the frequency unemployment

Answer 26

variability of demand for labor and the rate at which new workers enter the labor force.

Question 27

What are the determinants of the natural rate

Answer 27

frequency and duration of unemployment

Question 28

Spell unemployment is

Answer 28

period individual ramains continuously unemployed

Question 29

unemployment that exists when the economy is at full employment

Answer 29

frictional

Question 30

unemployment in excess of frictional unemployment: it occures when output is below its full-employment level

Answer 30

cyclical

Question 31

the relation between job vacancies and the unemployment rate

Answer 31

beveridge curve