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Exam 28: Unemployment and Its Natural Rate

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Question 1

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Frictional unemployment is often thought to explain relatively long spells of unemployment.

A) True
B) False

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False

Question 2

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Rupert is collecting unemployment insurance benefits. To continue to receive his benefits, he must be looking for work. Because he'd like to continue collecting benefits rather than take a job, he applies at places that are unlikely to hire him. People like Rupert make the reported unemployment rate less than it would otherwise be.

A) True
B) False

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When unions raise wages in one part of the economy, the supply of labor increases in other parts of the economy, which reduces wages in industries that are not unionized.

The unemployment rate is computed as the number of unemployed

Minimum wages create unemployment in markets where they create a

Advocates of government-run employment agencies and public training programs believe they make job search more efficient.

Every month, the Bureau of Labor Statistics surveys 160,000 business establishments to help determine the number of jobs the economy has gained or lost.

If people who report being unemployed are not, in fact, trying hard to find a job, then the reported unemployment rate will be biased upward.

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

Unions contribute to

Figure 28-3 ​ -Refer to Figure 28-3. If the minimum wage is equal to $125, what is the quantity of labor supplied, the quantity of labor demanded, and number unemployed?

The unemployed who quit their jobs, were fired for cause, or just entered the labor force are eligible for unemployment insurance.

Someone who loses his job at a truck factory because the demand for trucks has fallen and the demand for cars has risen, is structurally unemployed.

The Bureau of Labor Statistics' "unemployed" category includes those who were not employed, were available for work, and had tried to find employment during the previous four weeks.

In the U.S., the National Labor Relations Board is the government agency that enforces workers' right to unionize.

For 2015 the U.S. natural rate of unemployment was estimated to be about 4.9 percent, which was close to the actual unemployment rate in 2015.

Frictional unemployment is thought to explain relatively

Some of a firm's workers are made worse off by the introduction of a union.

Right-to-work laws allow striking union members to be permanently replaced.

Within the U.S. population, teenagers (ages 16-19) have higher rates of unemployment than adults of prime working age (ages 25-54), regardless of race or gender.