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Exam 28: Unemployment and Its Natural Rate

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Question 31

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Suppose that there is an excess supply of economics professors. Should universities necessarily reduce salaries? What does standard economic theory suggest? What does efficiency-wage theory suggest?

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Standard economic theory suggests that i...

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Question 32

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Why might a favorable change in the economy, such as technological improvement or a decrease in the price of imported oil, be associated with an increase in frictional unemployment?

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Even generally favorable changes will us...

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Question 33

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Sandy has graduated from college and is devoting her time to searching for a job. She has seen plenty of openings but has not yet been offered one that best suits her tastes and skills. Sandy is

The unemployed who quit their jobs, were fired for cause, or just entered the labor force are not eligible for unemployment insurance.

Almost nine-tenths of all spells of unemployment end when the unemployed person finds a job.

In one year, you meet 52 people who are each unemployed for one week and eight people who are each unemployed for the whole year. What percentage of the unemployment spells you encountered ended within one week and therefore was short term, and what percentage of the unemployment you encountered in a given week was long term?

If the wage is kept above the equilibrium level for any reason, the result is unemployment.

Suppose that the adult population in the country of Atlantis is 140 million. If 90 million people are employed and 10 million are unemployed, then

Most economists believe unions are bad for the economy as a whole.

Most spells of unemployment are long, and most unemployment observed at any given time is long-term.

Teenage unemployment is higher than unemployment of people ages 20 and over. Explain why economists would attribute at least part of this difference to minimum-wage laws.

Some degree of unemployment is __________ in a complex economy.

Government-run employment agencies and public training programs both seek to reduce frictional unemployment.

Unemployment insurance causes workers to be less likely to seek guarantees of job security when they negotiate with employers over the terms of employment.

Table 28-6 The table below lists the number of people by labor force classification for the country of Shelbyville. $\begin{array} { | l | l | } \hline \text { Employed } & 80 \text { million } \\\hline \text { Unemployed } & 20 \text { million } \\\hline \text { Not in the Labor Force } & 60 \text { million } \\\hline\end{array}$ -Refer to Table 28-6. What is the labor force participation rate?

Cyclical unemployment refers to

The Bureau of Labor Statistics defines discouraged workers as marginally attached workers who have given a job-market related reason for not currently looking for a job.

Most spells of unemployment are

Unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills is called

Table 28-5 2015 Labor Data for Tajnia $\begin{array} { | l | l | } \hline \text { Number of adults employed } & 10,000 \\\hline \text { Number of adults unemployed } & 2,250 \\\hline \text { Number of adults not in the labor force } & 17,750 \\\hline\end{array}$ -Refer to Table 28-5. The labor force of Tajnia in 2015 is 12,250.