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Exam 11: Unemployment and Labor Force Participation

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Question 51

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The phrase "persistent long-term unemployment" means:

A) that a substantial fraction of the unemployed have been so for more than one year.
B) that the unemployment problem has lasted for a long time.
C) that a substantial fraction of the unemployed have been so for more than one year and that this problem has lasted for a long time.
D) that a small fraction of the unemployed have been so for more than one year but that this problem has not lasted for a long time.

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Question 52

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The natural unemployment rates run higher for European countries than the United States. Briefly discuss some of the major reasons.

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The natural unemployment rate includes b...

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Question 53

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Which of the following is a case of frictional unemployment?

Explain the impact of unemployment benefits on the unemployment rate.

Active labor market policies:

Use the following to answer questions: Table: Employment, Unemployment, and Labor Force Participation $\begin{array} { l r r } \hline \text { Year } & \mathbf { 2 0 0 9 } & \mathbf { 2 0 1 0 } \\\hline \text { Population } & 380 \text { million } & 400 \text { million } \\\text { Adults in labor force } & 255 \text { million } & 260 \text { million } \\\text { Adults not in labor force } & 78 \text { million } & 80 \text { million } \\\text { Employed workers } & 245 \text { million } & 247 \text { million } \\\hline\end{array}$ -(Table: Employment, Unemployment, and Labor Force Participation) Refer to the table. What is the unemployment rate of the country in 2010?

Structural unemployment is:

Frictional unemployment is:

Cyclical unemployment can turn into structural unemployment if:

Use the following to answer questions: Table: Employment, Unemployment, and Labor Force Participation $\begin{array} { l r r } \hline \text { Year } & \mathbf { 2 0 0 9 } & \mathbf { 2 0 1 0 } \\\hline \text { Population } & 380 \text { million } & 400 \text { million } \\\text { Adults in labor force } & 255 \text { million } & 260 \text { million } \\\text { Adults not in labor force } & 78 \text { million } & 80 \text { million } \\\text { Employed workers } & 245 \text { million } & 247 \text { million } \\\hline\end{array}$ -(Table: Employment, Unemployment, and Labor Force Participation) Refer to the table. What is the unemployment rate of the country in 2009?

If the median wage is $9 in country X and $8 in country Y and both countries have similar elasticities of labor supply and demand, then a minimum wage of $4 in both countries will tend to:

When unions exert a great deal of influence, the effect on labor markets is similar to that of a minimum wage.

The minimum wage lowers the price of labor from the market wage to the minimum wage and as labor becomes less expensive, firms increase employment.

Discouraged workers are workers who have:

The labor force participation rate is highest among those:

During the 1980s, a reduction in the marginal tax rate (the tax on additional income) was found to:

If minimum wages are higher relative to the median wage, then minimum wage will affect:

Table: Statistics for a Small Economy $\begin{array} { l c } \hline \text { Type of statistic } & \text { Number (millions) } \\\hline \text { Population under the age of } 16 & 16 \\\text { Population over the age of } 16 & 54 \\\text { Retirees } & 14 \\\text { Discouraged workers } & 3 \\\text { Frictionally unemployed } & 1.5 \\\text { Structurally unemployed } & 2.5 \\\text { Cyclically unemployed } & 6 \\\hline\end{array}$ Refer to the table to answer the following questions. A) How many people are in the country's labor force? B) What is the labor force participation rate? C) What is the unemployment rate? D) What is the natural unemployment rate? E) What is the rate of cyclical unemployment?

Historical data support that long-term unemployment increases with higher costs of hiring and firing employees.

Why did 36,000 travel agents lose their jobs between 1999 and 2006?