Question 1:
Whom does the Bureau of Labor Statistics include in the “discouraged workers” group?
| a) All those between 16 and 65 who are neither disabled nor in an institution and are also neither employed nor seeking employment. |
| b) Civilian labor force members who have chosen early retirement because they dislike their work or think the pay is too low. |
| c) Members of the noninstitutional population who say they want to be employed but aren’t searching for a job. |
| d) Members of the civilian labor force who are looking for a job but cannot find one. |
| e) Anyone in the population who is not working. |
Question 2:
Sam is a musician who is out of work because electronic equipment replaced live musicians. This is an example of:
| a) frictional unemployment. |
| b) cyclical unemployment. |
| c) structural unemployment. |
| d) involuntary unemployment. |
Question 3:
Frictional unemployment refers to:
| a) people who are out of work and have no job skills. |
| b) short periods of unemployment needed to match jobs and job seekers. |
| c) people who spend relatively long periods out of work. |
| d) unemployment related to the ups and downs of the business cycle. |
Question 4:
Workers who may be between jobs are considered:
| a) frictionally unemployed. |
| b) structurally unemployed. |
| c) cyclically unemployed. |
| d) unemployable. |
| e) discouraged workers. |
Question 5:
The GDP gap is the difference between:
| a) full-employment real GDP and real GDP chain price index. |
| b) unemployment rate and real GDP chain price index. |
| c) actual real GDP and full-employment real GDP. |
| d) frictional unemployment and actual real GDP. |
Question 6:
As a general rule, a recession occurs when there is a six consecutive month fall in:
| a) nominal GDP. |
| b) real GDP. |
| c) the price level. |
| d) the trade balance. |
Question 7:
Exhibit 12-2 Unemployment categories
| Category | # of Individuals |
| Frictional unemployment | 20 |
| Structural unemployment | 35 |
| Cyclical unemployment | 60 |
| Discouraged workers | 5 |
| Underemployed workers | 10 |
| Fully employed workers | 410 |
| Population | 900 |
The unemployment rate for the economy in Exhibit 12-2 is:
| a) 28 percent. |
| b) 30.5 percent. |
| c) 31.7 percent. |
| d) 12.8 percent. |
| e) 21.5 percent. |
Question 8:
A decrease in aggregate demand and the subsequent cutbacks in production lead to:
| a) frictional unemployment. |
| b) cyclical unemployment. |
| c) cost-push unemployment. |
| d) structural unemployment. |
| e) transitory unemployment. |
Question 9:
The presence of discouraged workers may cause:
| a) the employment rate to be overstated. |
| b) the employment rate to be understated. |
| c) the unemployment rate to be overstated. |
| d) the unemployment rate to be understated. |
| e) GDP to be too large. |
Question 10:
The unemployment rate is the percentage of the:
| a) civilian labor force that is unemployed or working part-time. |
| b) civilian labor force that is unemployed. |
| c) civilian labor force that is unemployed less the number of government workers. |
| d) adult population that is unemployed. |
| e) adult population that is unemployed or looking for a better job. |
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