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ch15

Chapter15

UnemploymentandItsNaturalRate

1.Thenaturalrateofunemploymentisthe

a.unemploymentratethatwouldprevailwithzeroinflation.

b.rateassociatedwiththehighestpossiblelevelofGDP.

c.differencebetweenthelong-runandshort-rununemploymentrates.

d.amountofunemploymentthattheeconomynormallyexperiences.

ANSWER:

d.amountofunemploymentthattheeconomynormallyexperiences.

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2.Cyclicalunemploymentrefersto

a.therelationbetweentheprobabilityofunemploymentandaworker’schanginglevelofexperience.

b.howoftenaworkerislikelytobeemployedduringherlifetime

c.year-to-yearfluctuationsofunemploymentarounditsnaturalrate.

d.long-termtrendsinunemployment.

ANSWER:

c.year-to-yearfluctuationsofunemploymentarounditsnaturalrate.

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3.Cyclicalunemploymentiscloselyassociatedwith

a.long-termeconomicgrowth.

b.short-runupsanddownsoftheeconomy.

c.fluctuationsinthenaturalrateofunemployment.

d.seasonalfluctuationsinspending.

ANSWER:

b.short-runupsanddownsoftheeconomy.

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4.Thenaturalrateofunemployment

a.isaconstant.

b.isthedesirablerateofunemployment.

c.cannotbealteredbyeconomicpolicy.

d.Noneoftheabovearecorrect.

ANSWER:

d.Noneoftheabovearecorrect.

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5.Whichofthefollowingiscorrect?

a.Somedegreeofunemploymentisinevitable.

b.OtherthingsthesameanincreaseinthenumberofpeoplewhoareunemployeddecreasesrealGDP.

c.Cyclicalunemploymentisinverselyrelatedtoshort-runeconomicfluctuations.

d.Alloftheabovearecorrect.

ANSWER:

d.Alloftheabovearecorrect.

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6.Dataonunemploymentisreported

a.weekly.

b.monthly.

c.quarterly.

d.yearly.

ANSWER:

b.monthly.

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7.TheBLSproducesdataon

a.unemployment.

b.typesofemployment.

c.lengthoftheaverageworkweek.

d.Alloftheabovearecorrect.

ANSWER:

d.Alloftheabovearecorrect.

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8.Whichofthefollowingisincorrect?

a.Theunemploymentrateiscomputedusingthenumberofunemploymentinsuranceclaimsfiled.

b.Eachadultincludedintheunemploymentstatisticsisclassifiedasemployed,unemployed,ornotinthelaborforce.

c.Unemploymentnumbersincludepeopleagedsixteenandolder.

d.TheBureauofLaborStatisticsgathersdataonunemploymentandemployment.

ANSWER:

a.Theunemploymentrateiscomputedusingthenumberofunemploymentinsuranceclaimsfiled.

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9.Unemploymentdataiscollected

a.fromunemploymentinsuranceclaims.

b.througharegularsurveyofabout60,000households.

c.througharegularsurveyofabout200,000firms.

d.Unemploymentdataiscollectedusingalloftheabove.

ANSWER:

b.througharegularsurveyofabout60,000households.

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10.WhichlistincludesallthecategoriesintowhichtheBLSdividestheadultpopulation?

a.employedorunemployed

b.discouragedworkers,employed,orunemployed

c.employed,unemployed,ornotinthelaborforce

d.discouragedworkers,employed,ornotinthelaborforce

ANSWER:

c.employed,unemployed,ornotinthelaborforce

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11.Thelaborforceequalsthe

a.numberofpeoplewhoareemployed.

b.numberofpeoplewhoareunemployed.

c.numberofpeopleemployedplusthenumberofpeopleunemployed.

d.adultpopulation.

ANSWER:

c.numberofpeopleemployedplusthenumberofpeopleunemployed.

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12.Whoofthefollowingwouldbecountedasunemployedaccordingtoofficialstatistics?

a.Shasta,whoiswaitingforhernewjobtostart

b.Mary,whoworkedonly35hourslastweek

c.Karen,whoneitherhasajobnorislookingforone

d.Noneoftheabovewouldbecountedasunemployed.

ANSWER:

a.Shasta,whoiswaitingforhernewjobtostart

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13.Whichofthefollowingwouldbecountedasunemployedaccordingtoofficialstatistics?

a.Brian,afull-timestudentwhoisnotlookingforwork

b.Kate,whoisontemporarylayoff

c.Heath,whohasretiredandisnotlookingforwork

d.Alloftheabovewouldbecountedasunemployed.

ANSWER:

b.Kate,whoisontemporarylayoff

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14.Whowouldnotbeincludedinthelaborforce?

a.Jay,whoisontemporarylayoff

b.Mike,whohasretiredandisnotlookingforwork

c.Jane,whodoesnothaveajob,buthasappliedforseveralinthelastweek

d.Noneoftheaboveareincludedinthelaborforce.

ANSWER:

b.Mike,whohasretiredandisnotlookingforwork

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15.Whowouldbeincludedinthelaborforce?

a.Holly,anunpaidhomemaker

b.Tiffany,afull-timestudentnotlookingforwork

c.Cody,whodoesnothaveajob,butislookingforwork

d.Noneoftheaboveareincludedinthelaborforce.

ANSWER:

c.Cody,whodoesnothaveajob,butislookingforwork

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16.Whowouldbeincludedinthelaborforce?

a.Karen,whoworksmostoftheweekinasteelfactory

b.Beth,whoiswaitingforhernewjobatthebanktostart

c.Dave,whodoesnothaveajob,butislookingforwork

d.Alloftheaboveareincludedinthelaborforce.

ANSWER:

d.Alloftheaboveareincludedinthelaborforce.

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17.Whowouldbeincludedinthelaborforce?

a.Derrick,whoiswaitingforhisnewjobtostart

b.Brett,whohasbecomediscouragedlookingforajobandhasquitlookingforawhile

c.Homer,anunpaidhomemaker

d.Noneoftheabovewouldbeincludedinthelaborforce.

ANSWER:

a.Derrick,whoiswaitingforhisnewjobtostart

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18.Sallyisonatemporarylayofffromthefactorywhereshemakesplastictableware.IfSallyparticipatesintheBLSsurvey,shewillbeclassifiedas

a.unemployedandinthelaborforce.

b.unemployedandoutofthelaborforce.

c.employedandinthelaborforce.

d.employedandoutofthelaborforce.

ANSWER:

a.unemployedandinthelaborforce.

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19.WhichofthefollowingcorrectlyrankscategoriesfromsmallesttolargestaccordingtorecentU.S.values?

a.unemployed,employed,notinlaborforce

b.unemployed,notinlaborforce,employed

c.notinlaborforce,employed,unemployed

d.notinlaborforce,unemployed,employed

ANSWER:

b.unemployed,notinlaborforce,employed

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20.ApersonwhoiscountedasunemployedbytheBLSis

a.alsointhelaborforce.

b.mustbelookingforworkorontemporarylayoff.

c.beage16orover.

d.Alloftheabovearecorrect.

ANSWER:

d.Alloftheabovearecorrect.

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21.Acollegestudentwhoisnotworkingorlookingforajobiscountedas

a.neitheremployednorpartofthelaborforce.

b.unemployedandinthelaborforce.

c.unemployed,butnotinthelaborforce.

d.employedandinthelaborforce.

ANSWER:

a.neitheremployednorpartofthelaborforce.

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22.Latoya,ahomemakerwhoworksasavolunteeratthelocalRedCrossandiscurrentlynotlookingforajob,iscountedas

a.employedandinthelaborforce.

b.unemployedandinthelaborforce.

c.unemployedandnotinthelaborforce.

d.notinthelaborforce.

ANSWER:

d.notinthelaborforce.

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23.TheBLSdefinestheunemploymentrateasthepercentageof

a.thoseunemployedrelativetothepercentageemployed.

b.laborforcethatisunemployed.

c.adultpopulationthatisunemployed.

d.laborforcewithoutfulltimeemployment.

ANSWER:

b.laborforcethatisunemployed.

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24.Theunemploymentrateiscomputedasthenumberofunemployed

a.dividedbythelaborforcetimes100.

b.dividedbythenumberofpeopleemployedtimes100.

c.dividedbytheadultpopulationtimes100.

d.timestheparticipationratetimes100.

ANSWER:

a.dividedbythelaborforcetimes100.

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25.Whichofthefollowingdefinitionsiscorrect?

a.Laborforce=numberofemployed.

b.Laborforce=population–numberofunemployed.

c.UnemploymentRate=(numberofunemployed[numberofemployed+numberofunemployed])100.

d.UnemploymentRate=(numberofunemployedadultpopulation)100.

ANSWER:

c.UnemploymentRate=(numberofunemployed[numberofemployed+numberofunemployed]100.

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26.Thelabor-forceparticipationratemeasuresthepercentageofthe

a.totaladultpopulationthatisinthelaborforce.

b.totaladultpopulationthatisemployed.

c.laborforcethatisemployed.

d.laborforcethatiseitheremployedorunemployed.

ANSWER:

a.totaladultpopulationthatisinthelaborforce.

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27.Thelabor-forceparticipationrateisdefinedas

a.(EmployedAdultPopulation)100.

b.(EmployedLaborForce)100.

c.(LaborForceAdultPopulation)100.

d.(AdultPopulationLaborForce)100.

ANSWER:

c.(LaborForceAdultPopulation)100.

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28.Afewyearsago,basedonconceptssimilartothoseusedtoestimateU.S.employmentfigures,theCanadianadultnon-institutionalizedpopulationwas24million,thelaborforcewas16million,andthenumberofpeopleemployedwas14million.Accordingtothesenumbers,theCanadianlabor-forceparticipationra

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