Low unemployement Flashcards
(15 cards)
What is meant by low unemployment?
Low unemployment refers to a situation where a small percentage of the labor force is unemployed and actively seeking work.
True or False: Low unemployment is always a sign of a healthy economy.
False. While low unemployment can indicate economic health, it can also occur during periods of economic instability or inflation.
Fill in the blank: The ________ rate is the percentage of the labor force that is unemployed.
unemployment
What is one potential benefit of low unemployment for businesses?
Low unemployment can lead to a larger pool of customers, as more people have jobs and disposable income.
Multiple Choice: Which of the following is a consequence of low unemployment?
Increased wage pressure on employers.
What is the Natural Rate of Unemployment?
The Natural Rate of Unemployment is the level of unemployment that exists when the economy is at full employment, including frictional and structural unemployment.
True or False: Low unemployment can lead to inflation.
True. When unemployment is low, demand for workers increases, potentially leading to higher wages and inflation.
What is frictional unemployment?
Frictional unemployment occurs when individuals are temporarily unemployed while transitioning from one job to another.
Multiple Choice: Which type of unemployment is considered unavoidable?
Frictional unemployment.
What is cyclical unemployment?
Cyclical unemployment is caused by economic downturns or recessions that lead to a decrease in demand for labor.
Fill in the blank: A government policy that aims to reduce unemployment is known as ________ policy.
employment
What effect can low unemployment have on consumer spending?
Low unemployment typically leads to increased consumer spending due to higher disposable incomes.
True or False: A low unemployment rate guarantees job security for all workers.
False. Job security can still be affected by factors such as company performance and economic changes.
What is structural unemployment?
Structural unemployment occurs when there is a mismatch between the skills of the labor force and the needs of employers.
Multiple Choice: Which of the following is NOT a type of unemployment?
Seasonal unemployment.
