Question 1

Which of the following is correct?

Accepted Answer

A)   In unionized industries, wages are above the level that would prevail in competitive markets.
B)   The introduction of a union in some industry reduces the quantity of labor demanded in that industry, causes some workers in that industry to be unemployed, and reduces wages in the rest of the economy.
C)   Critics argue that the allocation of labor resulting from unions is both inefficient and inequitable.
D)   All of the above are correct.E) A) and B)
F) B) and D)

Question 2

The Bureau of Labor Statistics' household survey and establishment survey both yield the same results about total employment.

Accepted Answer

A) True 
 B)False

Question 3

Unions

Accepted Answer

A)   and firms paying wages above equilibrium to improve worker effort both create frictional unemployment.
B)   creates frictional unemployment, while firms paying wages above equilibrium to improve worker effort creates structural unemployment.
C)   creates structural unemployment, while firms paying wages above equilibrium to improve worker effort creates frictional unemployment.
D)   and firms paying wages above equilibrium to improve worker effort both create structural unemployment.E) A) and B)
F) A) and C)

Question 4

Studies have shown that the design of the unemployment insurance system reduces the job search effort of the unemployed.

Accepted Answer

A) True 
 B)False

Question 5

There is a clear consensus among economists that unions are

Accepted Answer

A)   good for the economy because they result in higher wages for most workers.
B)   good for the economy because they are a necessary antidote to the market power of employers.
C)   bad for the economy because they are cartels and therefore detrimental to an efficient allocation of resources.
D)   None of the above is correct; there is no clear consensus among economists about whether unions are good or bad for the economy.E) C) and D)
F) A) and D)

Question 6

The efficiency-wage theory of worker health is more relevant for explaining unemployment in less developed countries than in rich countries.

Accepted Answer

A) True 
 B)False

Question 7

Sectoral shifts in demand for output

Accepted Answer

A)   create structural unemployment.
B)   immediately reduce unemployment.
C)   increase unemployment due to job search.
D)   do not affect demand for labor.E) A) and B)
F) A) and C)

Question 8

Unions are exempt from U.S. antitrust laws.

Accepted Answer

A) True 
 B)False

Question 9

When a union raises the wage above the equilibrium level,

Accepted Answer

A)   both the quantity of labor supplied and unemployment rise.
B)   both the quantity of labor supplied and unemployment fall.
C)   the quantity of labor supplied rises and unemployment falls.
D)   the quantity of labor supplied falls and unemployment rises.E) None of the above
F) A) and D)

Question 10

Give an historical example of an efficiency wage that was considered by the firm to be "one of the finest cost­ cutting moves we ever made."

Accepted Answer

Henry Ford paid $5 per day to ...

Question 11

Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well­being.

Accepted Answer

A) True 
 B)False

Question 12

Olga owns her own business. Sven is an unpaid worker in his family's business. Who is included in the Bureau of Labor Statistics' "employed" category?

Accepted Answer

A)   only Olga
B)   only Sven
C)   both Olga and Sven
D)   neither Olga nor SvenE) All of the above
F) B) and C)

Question 13

Table 28-6
 
-Refer to Table 28-6. What is the U-3 measure of labor underutilization?

Accepted Answer

A)   4.7%
B)   6.2%
C)   7.0%
D)   10.9%E) A) and D)
F) C) and D)

Question 14

Which of the following is not an explanation for the existence of unemployment in the long run?

Accepted Answer

A)   it takes time for workers to search for the jobs that are best suited for them
B)   minimum-wage laws
C)   unions
D)   the business cycleE) C) and D)
F) All of the above

Question 15

The deviation of unemployment from its natural rate is called cyclical unemployment.

Accepted Answer

A) True 
 B)False

Question 16

To maintain their standard of living, most people rely on

Accepted Answer

A)   government assistance.
B)   their personal savings.
C)   their labor earnings.
D)   rental income.E) None of the above
F) B) and C)

Question 17

Causes of the changing role of women in American society over the past several decades include new technologies that have reduced the amount of time required to complete routine household tasks, improved birth control, and changing political and social attitudes.

Accepted Answer

A) True 
 B)False

Question 18

If all workers and all jobs were the same such that all workers were equally well suited for all jobs, then there would be no

Accepted Answer

A)   cyclical unemployment.
B)   frictional unemployment.
C)   natural rate of unemployment.
D)   structural unemployment.E) None of the above
F) All of the above

Question 19

The reported unemployment rate should be viewed as

Accepted Answer

A)   a useful but imperfect measure of joblessness.
B)   clearly smaller than the true unemployment rate.
C)   clearly larger than the true unemployment rate.
D)   being very close to the true unemployment rate.E) A) and B)
F) B) and D)

Question 20

Which of the following is not a reason economies experience structural unemployment?

Accepted Answer

A)   job search
B)   unions
C)   minimum-wage laws
D)   efficiency wagesE) None of the above
F) A) and B)

Exam 20: Unemployment

There is a clear consensus among economists that unions are

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Which of the following is correct?

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Sectoral shifts in demand for output

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Table 28-6 -Refer to Table 28-6. What is the U-3 measure of labor underutilization?

Correct AnswerverifiedShow Answer

Which of the following is not an explanation for the existence of unemployment in the long run?

Correct AnswerverifiedShow Answer

Causes of the changing role of women in American society over the past several decades include new technologies that have reduced the amount of time required to complete routine household tasks, improved birth control, and changing political and social attitudes.

Correct AnswerverifiedShow Answer

Unions

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Unions are exempt from U.S. antitrust laws.

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If all workers and all jobs were the same such that all workers were equally well suited for all jobs, then there would be no

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Which of the following is not a reason economies experience structural unemployment?

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The reported unemployment rate should be viewed as

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The Bureau of Labor Statistics' household survey and establishment survey both yield the same results about total employment.

Correct AnswerverifiedShow Answer

The efficiency-wage theory of worker health is more relevant for explaining unemployment in less developed countries than in rich countries.

Correct AnswerverifiedShow Answer

When a union raises the wage above the equilibrium level,

Correct AnswerverifiedShow Answer

Most economists agree that eliminating unemployment insurance would increase the nation's overall level of well­being.

Correct AnswerverifiedShow Answer

Give an historical example of an efficiency wage that was considered by the firm to be "one of the finest cost­ cutting moves we ever made."

Correct AnswerverifiedHenry Ford paid $5 per day to ...View AnswerShow Answer

To maintain their standard of living, most people rely on

Correct AnswerverifiedShow Answer

Studies have shown that the design of the unemployment insurance system reduces the job search effort of the unemployed.

Correct AnswerverifiedShow Answer

Olga owns her own business. Sven is an unpaid worker in his family's business. Who is included in the Bureau of Labor Statistics' "employed" category?

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The deviation of unemployment from its natural rate is called cyclical unemployment.

Correct AnswerverifiedShow Answer

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Most economists agree that eliminating unemployment insurance would increase the nation's overall level of wellbeing.

Correct Answer
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Give an historical example of an efficiency wage that was considered by the firm to be "one of the finest cost cutting moves we ever made."

Correct Answer
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Henry Ford paid $5 per day to ...
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