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82. Causes of the decline in the U.S. men’s labor-force participation rate over the past several decades include young men
now staying in school longer than their fathers and grandfathers did, older men now retiring earlier and living longer, and
more fathers now staying at home to raise their children.
a.
True
b.
False
83. Even though the difference in labor-force participation rates of U.S. males and females has narrowed, the labor-force
participation rate of males remains higher than that of females.
a.
True
b.
False
84. Measuring the amount of unemployment in the economy is a straightforward task.
a.
True
b.
False
85. More than one-third of the unemployed are recent entrants into the labor force.
a.
True
b.
False
86. More than three-fourths of the unemployed are recent entrants into the labor force.
a.
True
b.
False
87. Not all unemployment ends with the job seeker finding a job.
a.
True
b.
False
88. Because people move into and out of the labor force so often, statistics on unemployment are difficult to interpret.
a.
True
b.
False
89. If people who report being unemployed are not, in fact, trying hard to find a job, then the reported unemployment rate
will be biased upward.
a.
True
b.
False
90. Rupert is collecting unemployment insurance benefits. To continue to receive his benefits, he must be looking for
work. Because he’d like to continue collecting benefits rather than take a job, he applies at places that are unlikely to hire
him. People like Rupert make the reported unemployment rate less than it would otherwise be.
a.
True
b.
False
91. People who report being unemployed but who, in fact, are working for “under the table” pay to avoid taxes on their
earnings are really employed and therefore cause the reported unemployment rate to be higher than it would otherwise be.
a.
True
b.
False
92. 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.
a.
True
b.
False
93. Discouraged workers are people who want to work but have given up trying to find a job after an unsuccessful search.
a.
True
b.
False
94. It is best to view the official unemployment rate as a useful but imperfect measure of joblessness.
a.
True
b.
False
95. The unemployment rate reported by the Bureau of Labor Statistics clearly understates the true unemployment rate.
a.
True
b.
False
96. 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.
a.
True
b.
False
97. 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.
a.
True
b.
False
98. The Bureau of Labor Statistics’ U-1 measure of joblessness is smaller than its U-6 measure of joblessness.
a.
True
b.
False
99. The Bureau of Labor Statistics’ U-1 measure of joblessness is larger than its U-6 measure of joblessness.
a.
True
b.
False
100. The Bureau of Labor Statistics’ U-1 measure of joblessness includes only very long-term unemployed.
a.
True
b.
False
101. The Bureau of Labor Statistics’ U-2 measure of joblessness includes job losers and job leavers.
a.
True
b.
False
102. The Bureau of Labor Statistics’ U-3 measure of joblessness is the official unemployment rate.
a.
True
b.
False
103. The Bureau of Labor Statistics’ U-4 measure of joblessness includes discouraged workers.
a.
True
b.
False
104. The Bureau of Labor Statistics’ U-5 measure of joblessness is the official unemployment rate.
a.
True
b.
False
105. The Bureau of Labor Statistics’ U-5 measure of joblessness includes marginally attached workers.
a.
True
b.
False
106. Almost half of all spells of unemployment end when the unemployed person leaves the labor force.
a.
True
b.
False
107. Almost nine-tenths of all spells of unemployment end when the unemployed person finds a job.
a.
True
b.
False
108. Most spells of unemployment are short, and most unemployment observed at any given time is long-term.
a.
True
b.
False
109. Most spells of unemployment are short, and most unemployment observed at any given time is short-term.
a.
True
b.
False
110. Most spells of unemployment are long, and most unemployment observed at any given time is long-term.
a.
True
b.
False
111. Data on unemployment indicate that most people who become unemployed will soon find jobs.
a.
True
b.
False
112. Most spells of unemployment are long, and most unemployment observed at any given time is long-term.
a.
True
b.
False
113. Most spells of unemployment are short. About half of unemployment spells end with an exit from the labor force.
a.
True
b.
False
114. In an ideal labor market, wages would adjust to balance the quantity of labor supplied and the quantity of labor
demanded, ensuring that all workers are always fully employed.
a.
True
b.
False
115. There are always some workers without jobs, even when the overall economy is doing well.
a.
True
b.
False
116. The unemployment rate never falls to zero.
a.
True
b.
False
117. One explanation for long-run unemployment is that it takes time for workers to search for the jobs that are best suited
for them.
a.
True
b.
False
118. The unemployment that results from the process of matching workers and jobs is called frictional unemployment.
a.
True
b.
False
119. The unemployment that results from the process of matching workers and jobs is called structural unemployment.
a.
True
b.
False
120. Frictional unemployment is often thought to explain relatively short spells of unemployment.
a.
True
b.
False
121. Frictional unemployment is often thought to explain relatively long spells of unemployment.
a.
True
b.
False
122. 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.
a.
True
b.
False
123. The unemployment that results from the quantity of labor supplied exceeding the quantity demanded is called
structural unemployment.
a.
True
b.
False
124. The unemployment that results from the quantity of labor supplied exceeding the quantity demanded is called
frictional unemployment.
a.
True
b.
False
125. Structural unemployment results when wages are, for some reason, set above the level that brings supply and demand
into equilibrium.
a.
True
b.
False
126. Structural unemployment is often thought to explain relatively long spells of unemployment.
a.
True
b.
False
127. Structural unemployment is often thought to explain relatively short spells of unemployment.
a.
True
b.
False
128. Three possible reasons for an above-equilibrium wage are minimum-wage laws, unions, and efficiency wages.
a.
True
b.
False
129. Every month, the Bureau of Labor Statistics surveys 160,000 business establishments to help determine the number
of jobs the economy has gained or lost.
a.
True
b.
False
130. The Bureau of Labor Statistics’ household survey and establishment survey both yield the same results about total
employment.
a.
True
b.
False
131. The Bureau of Labor Statistics’ household survey and establishment survey both yield information about
unemployment.
a.
True
b.
False
132. One reason economies always experience some unemployment is job search.
a.
True
b.
False
133. Job search is the process of matching workers with appropriate jobs.
a.
True
b.
False
134. If all workers and all jobs were the same such that all workers were equally well suited for all jobs, then job search
would not be a problem.
a.
True
b.
False
135. 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 frictional unemployment.
a.
True
b.
False
136. Frictional unemployment is often the result of changes in the demand for labor among different firms.
a.
True
b.
False
137. Frictional unemployment is inevitable because the economy is always changing.
a.
True
b.
False
138. The demand for labor by a certain firm fluctuates as the demand for that firm’s product fluctuates.
a.
True
b.
False
139. The demand for labor by a certain firm is independent of the demand for that firm’s product.
a.
True
b.
False
140. Employment can rise in one region of the country while it falls in another.
a.
True
b.
False
141. Changes in the composition of demand among industries or regions are called sectoral shifts.
a.
True
b.
False
142. Sectoral shifts temporarily cause unemployment.
a.
True
b.
False
143. Sectoral shifts contribute to frictional unemployment.
a.
True
b.
False
144. Sectoral shifts contribute to structural unemployment.
a.
True
b.
False
145. Someone who loses his job at a truck factory because the demand for trucks has fallen and the demand for cars has
risen, is structurally unemployed.
a.
True
b.
False
146. The destruction of manufacturing jobs and workers leaving their jobs to find better ones both contribute to frictional
unemployment.
a.
True
b.
False
147. The destruction of manufacturing jobs and workers leaving their jobs to find better ones both contribute to structural
unemployment.
a.
True
b.
False
148. Public policy can reduce the economy’s natural rate of unemployment.
a.
True
b.
False
149. Public policy can reduce frictional unemployment.
a.
True
b.
False
150. Policies that reduce the time it takes unemployed workers to find new jobs can reduce the economy’s natural rate of
unemployment.
a.
True
b.
False
151. Government-run employment agencies and public training programs both seek to reduce frictional unemployment.
a.
True
b.
False
152. Advocates of government-run employment agencies and public training programs believe they make job search more
efficient.
a.
True
b.
False
153. Critics of government-run employment agencies and public training programs argue that the private market is better
at matching workers and jobs than the government is.
a.
True
b.
False
154. Most job search in the U.S. economy takes place without intervention by the government.
a.
True
b.
False
155. Most job search in the U.S. economy takes place with the help of the government.
a.
True
b.
False
156. Public policy, without intending to do so, can increase frictional unemployment.
a.
True
b.
False
157. An American worker who becomes unemployed typically receives 100% of her former salary during the first six
months she is unemployed.
a.
True
b.
False
158. Unemployment insurance increases frictional unemployment.
a.
True
b.
False
159. Unemployment insurance reduces hardships of unemployment but also increases the amount of structural
