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Exam 28: Unemployment and Its Natural Rate

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Question 171

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Data on unemployment indicate that most people who become unemployed will soon find jobs.

A) True
B) False

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Question 172

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The Bureau of Labor Statistics defines marginally attached workers as persons who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the recent past.

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B) False

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Question 173

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Within the U.S. population, women of prime working age (ages 25-54) have lower rates of labor-force participation than men of prime working age (ages 25-54), regardless of race.

The Bureau of Labor Statistics produces data on unemployment and other aspects of the labor market from a regular survey of about 60,000 households, called the Current Population Survey.

When a union bargains successfully with employers, in that industry,

According to the theory of efficiency wages, firms operate more efficiently if wages are above the equilibrium level.

Suppose that garbage collectors and landscaping workers have no unions. Now suppose that garbage collectors form unions. What does this do to the labor supply and wages of landscaping workers?

Most economists agree that eliminating unemployment insurance would increase the amount of unemployment in the economy.

An economy's natural rate of unemployment refers to the amount of unemployment that the economy normally experiences.

Table 28-7 The table below lists the number of people by labor force classification for the country of Springfield. $\begin{array} { | l | l | } \hline \text { Employed } & 78 \text { million } \\\hline \text { Part-time employed } & 22 \text { million } \\\hline \text { Unemployed } & 12 \text { million } \\\hline \text { Marginally attached } & 3 \text { million } \\\hline \text { Not in the Labor Force } & 30 \text { million } \\\hline \text { Discouraged } & 4 \text { million } \\\hline\end{array}$ -Refer to Table 28-7. Calculate the number in the labor force, and the unemployment rate.

Martha is looking for work as a electrical engineer. Her prospects are good but so far she has not taken a job. Jennifer is looking for work in a paper mill. Every time Jennifer shows up for an interview, there are more people looking for work than there are openings. She realizes that it has been that way for a long time.

Table 28-7 The table below lists the number of people by labor force classification for the country of Springfield. $\begin{array} { | l | l | } \hline \text { Employed } & 78 \text { million } \\\hline \text { Part-time employed } & 22 \text { million } \\\hline \text { Unemployed } & 12 \text { million } \\\hline \text { Marginally attached } & 3 \text { million } \\\hline \text { Not in the Labor Force } & 30 \text { million } \\\hline \text { Discouraged } & 4 \text { million } \\\hline\end{array}$ -Refer to Table 28-7. Calculate the number in the adult population, and the labor force participation rate.

Minimum-wage laws are least likely to affect the wages paid to

Structural unemployment results when wages are, for some reason, set above the level that brings supply and demand into equilibrium.

Some long-run unemployment may be explained by the fact that the number of jobs available in some labor markets may be insufficient to give a job to everyone who wants one.

The unemployment rate equals the percentage of the labor force that is unemployed.

If the wage is kept above the equilibrium level because of minimum-wage laws, then the result is unemployment; if the wage is kept above the equilibrium level for some other reason, the result need not be unemployment.

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 unemployment rate?

Which of the following is an example of an efficiency wage?

People who report being not in the labor force but who, in fact, want to work but have given up trying to find a job after an unsuccessful search cause the reported unemployment rate to be lower than it would otherwise be.