Question 1

Which of the following causes of unemployment is not associated with an excess supply of labour?

Accepted Answer

A)   Minimum wage laws
B)   Unions
C)   Job search
D)   Efficiency wagesE) All of the above
F) B) and C)

Question 2

Graph 28-1
 
-A union is:

Accepted Answer

A)   the decision of one firm to merge with another
B)   an employee bargaining association limited to professional sports
C)   a group of employers who band together for the purpose of bargaining with employees
D)   a worker association that bargains with employers over wages and working conditionsE) A) and B)
F) None of the above D

Question 3

Job-search unemployment is different from unemployment arising from minimum-wage laws, unions and efficiency wages because in the former case, workers are searching for the jobs that best suit them, while in the latter, workers are waiting for jobs to open up.

Accepted Answer

A) True 
 B)False  True

Question 4

Which of the following does not cause unemployment?

Accepted Answer

A)   Unions
B)   Minimum wage laws
C)   Job matching programs
D)   Efficiency wagesE) All of the above
F) B) and D)

Question 5

Economists and policymakers should focus on solving problems of short-term unemployment, since long-term unemployment will be resolved eventually.

Accepted Answer

A) True 
 B)False

Question 6

If the adult population is 18.01 million, and the participation rate is 65.4%, what is the total amount of the labour force?

Accepted Answer

65.4% = labour force/18.01 million. Transposed, the answer is 11.77-8 million

Question 7

The main reason for the fall in union membership is that more people are educated and able to manage their own wages.

Accepted Answer

A) True 
 B)False

Question 8

Why is job-search unemployment inevitable?

Accepted Answer

Job-search unemployment is inevitable be...

Question 9

Job search:

Accepted Answer

A)   explains why firms pay higher than the competitive equilibrium wage
B)   is due to the failure of wages to balance labour supply and labour demand
C)   is the process of matching workers with appropriate jobs
D)   all of the aboveE) A) and B)
F) B) and C)

Question 10

Which of the following causes of unemployment would most likely be affected by more accessible information about job opportunities?

Accepted Answer

A)   Collective bargaining
B)   Minimum wage laws
C)   Job search
D)   Efficiency wagesE) A) and D)
F) A) and B)

Question 11

Graph 28-1
 0, and the equilibrium market quantity of labour hired is L0 B)  W0, and the equilibrium market quantity of labour hired is L1 C)  W1, and the equilibrium market quantity of labour hired is L1 D)  W1, and the equilibrium market quantity of labour hired is L0 E)  W1, and the equilibrium market quantity of labour hired is L2 " class="answers-bank-image d-inline" rel="preload" >
-In Graph 28-1, without a minimum wage law, the equilibrium market wage is:

Accepted Answer

A)   W0, and the equilibrium market quantity of labour hired is L0
B)   W0, and the equilibrium market quantity of labour hired is L1
C)   W1, and the equilibrium market quantity of labour hired is L1
D)   W1, and the equilibrium market quantity of labour hired is L0
E)   W1, and the equilibrium market quantity of labour hired is L2F) A) and B)
G) A) and E)

Question 12

Most spells of unemployment are:

Accepted Answer

A)   short , and most unemployment observed at any given time is long-term
B)   long , and most unemployment observed at any given time is long-term
C)   short, and most unemployment observed at any given time is short-term
D)   long , and most unemployment observed at any given time is short-termE) A) and B)
F) B) and C)

Question 13

Students are regarded as employed in studies and are recorded as unemployed, but not in the labour force.

Accepted Answer

A) True 
 B)False

Question 14

Fred decides to hire some additional mechanics to work in his expanded automotive business. The going wage is $16 per hour. Efficiency-wage theory suggests that Fred should offer:

Accepted Answer

A)   very little as the automotive industry is a sunset industry
B)   the minimum wage which is $14 per hour, since some mechanics would be willing to work at that level
C)   more than $16 per hour, so as to attract a better pool of applicants
D)   enough to attract the number of applicants necessary to fill the jobs availableE) A) and B)
F) B) and C)

Question 15

The percentage of employees that have joined unions in Australia has fallen over the past 60 years.

Accepted Answer

A) True 
 B)False

Question 16

Graph 28-1
 1 as shown in Graph 28-1. After introducing the minimum wage law, the quantity of labour supplied is _______  A)  L0, the quantity of labour demanded is L0 and the amount of unemployed labour is zero B)  L0, the quantity of labour demanded is L1and the amount of unemployed labour is L0-L1 C)  L2, the quantity of labour demanded is L0 and the amount of unemployed labour is L2-L0 D)  L2, the quantity of labour demanded is L1 and the amount of unemployed labour is L2-L1 " class="answers-bank-image d-inline" rel="preload" >
-The government has introduced the minimum wage law. The minimum wage is set at W1 as shown in Graph 28-1. After introducing the minimum wage law, the quantity of labour supplied is _______

Accepted Answer

A)   L0, the quantity of labour demanded is L0 and the amount of unemployed labour is zero
B)   L0, the quantity of labour demanded is L1and the amount of unemployed labour is L0-L1
C)   L2, the quantity of labour demanded is L0 and the amount of unemployed labour is L2-L0
D)   L2, the quantity of labour demanded is L1 and the amount of unemployed labour is L2-L1E) A) and C)
F) All of the above

Question 17

Which of the following statements is correct about minimum wages?

Accepted Answer

A)   Minimum wages are a predominant cause of unemployment in the economy
B)   Minimum wages do not cause unemployment
C)   Minimum wages have an important effect on certain groups with particularly high unemployment rates
D)   Minimum wages are binding in every labour market equallyE) None of the above
F) B) and C)

Question 18

The labour-force participation rate:

Accepted Answer

A)   equals one minus the unemployment rate
B)   measures the percentage of the total adult population in the labour force
C)   measures the percentage of the number of employed in the labour force
D)   equals one minus the labour forceE) A) and C)
F) All of the above

Question 19

Wages at a rate greater than the minimum level can:

Accepted Answer

A)   create productivity gains if managed correctly
B)   encourage higher quality candidates to apply for positions
C)   encourage a labour surplus
D)   all of the aboveE) A) and B)
F) B) and C)

Question 20

Which of the following is the correct statement?

Accepted Answer

A)   There is no easy way for policymakers to reduce the economy's natural rate of unemployment, but it is easy to alleviate the hardships of the unemployed
B)   There is no easy way for policymakers to reduce the economy's natural rate of unemployment and at the same time alleviate the hardships of the unemployed
C)   There is no easy way for policymakers to alleviate the hardships experienced by the unemployed, but it is easy to reduce the economy's natural rate of unemployment
D)   None of the aboveE) C) and D)
F) B) and D)

Exam 28: The Natural Rate of Unemployment

Which of the following causes of unemployment is not associated with an excess supply of labour?

Correct AnswerverifiedShow Answer

Graph 28-1 -A union is:

Correct AnswerverifiedD

Job-search unemployment is different from unemployment arising from minimum-wage laws, unions and efficiency wages because in the former case, workers are searching for the jobs that best suit them, while in the latter, workers are waiting for jobs to open up.

Correct AnswerverifiedTrue

Which of the following does not cause unemployment?

Correct AnswerverifiedShow Answer

Economists and policymakers should focus on solving problems of short-term unemployment, since long-term unemployment will be resolved eventually.

Correct AnswerverifiedShow Answer

If the adult population is 18.01 million, and the participation rate is 65.4%, what is the total amount of the labour force?

Correct Answerverified65.4% = labour force/18.01 million. Transposed, the answer is 11.77-8 million

The main reason for the fall in union membership is that more people are educated and able to manage their own wages.

Correct AnswerverifiedShow Answer

Why is job-search unemployment inevitable?

Correct AnswerverifiedJob-search unemployment is inevitable be...View AnswerShow Answer

Job search:

Correct AnswerverifiedShow Answer

Which of the following causes of unemployment would most likely be affected by more accessible information about job opportunities?

Correct AnswerverifiedShow Answer

Graph 28-1 -In Graph 28-1, without a minimum wage law, the equilibrium market wage is:

Correct AnswerverifiedShow Answer

Most spells of unemployment are:

Correct AnswerverifiedShow Answer

Students are regarded as employed in studies and are recorded as unemployed, but not in the labour force.

Correct AnswerverifiedShow Answer

Fred decides to hire some additional mechanics to work in his expanded automotive business. The going wage is $16 per hour. Efficiency-wage theory suggests that Fred should offer:

Correct AnswerverifiedShow Answer

The percentage of employees that have joined unions in Australia has fallen over the past 60 years.

Correct AnswerverifiedShow Answer

Graph 28-1 -The government has introduced the minimum wage law. The minimum wage is set at W1 as shown in Graph 28-1. After introducing the minimum wage law, the quantity of labour supplied is _______

Correct AnswerverifiedShow Answer

Which of the following statements is correct about minimum wages?

Correct AnswerverifiedShow Answer

The labour-force participation rate:

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Wages at a rate greater than the minimum level can:

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Which of the following is the correct statement?

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D

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True

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65.4% = labour force/18.01 million. Transposed, the answer is 11.77-8 million

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Job-search unemployment is inevitable be...
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Graph 28-1 -The government has introduced the minimum wage law. The minimum wage is set at W₁ as shown in Graph 28-1. After introducing the minimum wage law, the quantity of labour supplied is _______

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