Question 1

Wages in excess of their equilibrium level help explain

Accepted Answer

A)  frictional but not structural unemployment.
B)  structural but not frictional unemployment.
C)  both frictional and structural unemployment.
D)  neither frictional nor structural unemployment.E) B) and D)
F) A) and B)

Question 2

Employment can rise in one region of the country while it falls in another.

Accepted Answer

A) True 
 B)False

Question 3

Cyclical unemployment is caused by

Accepted Answer

A)  frictional and structural unemployment
B)  frictional but not structural unemployment
C)  structural but not frictional unemployment
D)  neither frictional nor structural unemploymentE) B) and C)
F) A) and B)

Question 4

It is best to view the official unemployment rate as a useful but imperfect measure of joblessness.

Accepted Answer

A) True 
 B)False

Question 5

Unemployment numbers reported by the Bureau of Labor Statistics are reported based on a

Accepted Answer

A)  monthly survey of about 60,000 households.
B)  monthly survey of about 6,000 households.
C)  weekly survey of about 60,000 households.
D)  weekly survey of about 6,000 households.E) A) and D)
F) None of the above

Question 6

Suppose that because of the popularity of the low-carb diet, bakeries need fewer workers and steak houses need more workers. The unemployment created by this change is

Accepted Answer

A)  frictional unemployment created by efficiency wages.
B)  frictional unemployment created by sectoral shifts.
C)  structural unemployment created by efficiency wages.
D)  structural unemployment created by sectoral shifts.E) A) and D)
F) All of the above

Question 7

The labor-force participation rate tells us the fraction of the population that has chosen to participate in the labor market.

Accepted Answer

A) True 
 B)False

Question 8

Changes in the composition of demand among industries or regions are called sectoral shifts.

Accepted Answer

A) True 
 B)False

Question 9

Some economists have argued that unemployment insurance improves the ability of the economy to match each worker with the most appropriate job.

Accepted Answer

A) True 
 B)False

Question 10

Efficiency wages

Accepted Answer

A)  increase frictional unemployment by keeping wages above equilibrium.
B)  decrease frictional unemployment by keeping wages at equilibrium.
C)  increase structural unemployment by keeping wages above equilibrium.
D)  decrease structural unemployment by keeping wages at equilibrium.E) None of the above
F) B) and C)

Question 11

Figure 28-7 
-Refer to Figure 28-7. Without a minimum wage, what is the equilibrium level of employment? Explain what happens to the level of employment if the minimum wage is equal to $125.

Accepted Answer

Without a minimum wage, employ...

Question 12

If a country signs a trade agreement so that employment in some industries rises and employment in some industries fall, then

Accepted Answer

A)  structual unemployment rises temporarily.
B)  structural unemployment rises permananently.
C)  frictional unemployment rises temporarily.
D)  frictional unemployment rises permanently.E) A) and D)
F) C) and D)

Question 13

An economy's natural rate of unemployment is the

Accepted Answer

A)  economy's long-run target level of unemployment.
B)  amount of unemployment that the economy normally experiences.
C)  lowest rate of unemployment the economy can achieve.
D)  All of the above are correct.E) A) and D)
F) A) and C)

Question 14

Which of the following is not correct?

Accepted Answer

A)  The unemployment rate is an imperfect measure of a nation's overall level of economic well-being.
B)  Most job search in the U.S. economy takes place without intervention by the government.
C)  Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well-being.
D)  Other things the same, countries that offer more generous and longer-lasting unemployment insurance benefits are likely to have higher unemployment rates.E) A) and B)
F) A) and C)

Question 15

Efficiency wages

Accepted Answer

A)  increase productivity and reduce unemployment.
B)  increase productivity but increase unemployment.
C)  decrease productivity but reduce unemployment.
D)  decrease productivity and increase unemployment.E) A) and B)
F) A) and C)

Question 16

The National Labor Relations Board

Accepted Answer

A)  enforces antitrust laws against unions.
B)  enforces workers' rights to unionize.
C)  acts as a union's representative in collective bargaining.
D)  is required to approve all collective bargaining agreements before they can be enforced.E) A) and B)
F) B) and C)

Question 17

A typical American worker covered by unemployment insurance receives 50 percent of his former wages for 52 weeks.

Accepted Answer

A) True 
 B)False

Question 18

The natural rate of unemployment is any type of unemployment that does not go away on its own even in the long run.

Accepted Answer

A) True 
 B)False

Question 19

List the four types of efficiency-wage theory.

Accepted Answer

Worker health, worke...

Question 20

Right-to-work laws

Accepted Answer

A)  guarantee workers the right to form unions.
B)  give workers in a unionized firm the right to choose whether to join the union.
C)  prevent employers from hiring permanent replacements for workers who are on strike.
D)  prevent workers from being fired because of increases in wages brought about by collective bargaining.E) B) and C)
F) B) and D)

Exam 28: Unemployment and Its Natural Rate

Employment can rise in one region of the country while it falls in another.

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Which of the following is not correct?

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Wages in excess of their equilibrium level help explain

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The natural rate of unemployment is any type of unemployment that does not go away on its own even in the long run.

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Unemployment numbers reported by the Bureau of Labor Statistics are reported based on a

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An economy's natural rate of unemployment is the

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The National Labor Relations Board

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Some economists have argued that unemployment insurance improves the ability of the economy to match each worker with the most appropriate job.

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The labor-force participation rate tells us the fraction of the population that has chosen to participate in the labor market.

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Cyclical unemployment is caused by

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It is best to view the official unemployment rate as a useful but imperfect measure of joblessness.

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Changes in the composition of demand among industries or regions are called sectoral shifts.

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Efficiency wages

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If a country signs a trade agreement so that employment in some industries rises and employment in some industries fall, then

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List the four types of efficiency-wage theory.

Correct AnswerverifiedWorker health, worke...View AnswerShow Answer

Efficiency wages

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A typical American worker covered by unemployment insurance receives 50 percent of his former wages for 52 weeks.

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Figure 28-7 -Refer to Figure 28-7. Without a minimum wage, what is the equilibrium level of employment? Explain what happens to the level of employment if the minimum wage is equal to $125.

Correct AnswerverifiedWithout a minimum wage, employ...View AnswerShow Answer

Suppose that because of the popularity of the low-carb diet, bakeries need fewer workers and steak houses need more workers. The unemployment created by this change is

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Right-to-work laws

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Worker health, worke...
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Without a minimum wage, employ...
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