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Exam 6: Unemployment

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Question 31

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A miner who has been unable to find work for so long that he has stopped looking for work is considered to be

A) not in the labour force.
B) not in the adult population.
C) unemployed.
D) employed.

E) A) and D)
F) A) and C)

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Question 32

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Table 2.The figures in the table below are taken from the statistics office in a fictional country called Exland. $\begin{array}{llcc} \text {Number of workers employed} &8,400\\ \text {Frictional unemployment} &250\\ \text {Structural unemployment} &350\\ \text {Cyclical unemployment} &600\\ \text {Discouraged workers} &400\\ \text {Adult population} &12,000\\\end{array}$ -Refer to Table 2.How large is the labour force in Exland?

A) 7,550.
B) 8,000.
C) 8,400.
D) 9,600.

E) A) and C)
F) C) and D)

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Question 33

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Why might a favourable change in the South African economy, such as technological improvement or a decrease in the price of imported oil, be associated with an increase in frictional unemployment?

Firms may voluntarily pay wages above the level that balances the supply and demand for workers because the higher wage improves the average quality of workers that apply for employment.

The amount of _____ _____increases when the economy goes into a recession and decreases when the economy goes into an expansion.

Table 2.The figures in the table below are taken from the statistics office in a fictional country called Exland. $\begin{array}{llcc} \text {Number of workers employed} &8,400\\ \text {Frictional unemployment} &250\\ \text {Structural unemployment} &350\\ \text {Cyclical unemployment} &600\\ \text {Discouraged workers} &400\\ \text {Adult population} &12,000\\\end{array}$ -Refer to Table 2.What is the labour force participation rate in Exland?

Table 1: Statistics from a fictional country $\begin{array} { | l | c | } \hline & \text { Nurnbers in millions } \\\hline \text { Total population } & 195.4 \\\hline \text { Adult population } & 139.7 \\\hline \text { Number of urnerriployed } & 5.7 \\\hline \text { Number of employed } & 92.3 \\\hline\end{array}$ -Refer to Table 1.The labour force participation rate is

How can both the employment and the unemployment rate both rise in an economy?

Whenever the wage rises above the competitive equilibrium, regardless of the source, the result is additional unemployment.

Since unemployment rates are consistently higher in some African countries like South Africa and Zimbabwe than in Botswana, it appears that the natural rate of unemployment is lower in Botswana.What might explain this difference?

Robert recently completed his university degree and is entering the labour market for the first time.He has been submitting applications and has been interviewed twice in the last two weeks, but so far has not found a job.Robert could be classified as

Markus is a low-skilled worker who washes dishes in a local restaurant.He is worried about a proposed increase in the minimum wage because price

Table 1: Statistics from a fictional country $\begin{array} { | l | c | } \hline & \text { Nurnbers in millions } \\\hline \text { Total population } & 195.4 \\\hline \text { Adult population } & 139.7 \\\hline \text { Number of urnerriployed } & 5.7 \\\hline \text { Number of employed } & 92.3 \\\hline\end{array}$ -Refer to Table 1.The labour force is

If unemployment insurance were so generous that it paid laid off workers 95 per cent of their regular salary,

If wages were always at the competitive equilibrium, there would be absolutely no unemployment.

Which of the following is an example of a reason why firms might pay efficiency wages? At equilibrium wages,

The natural rate of unemployment

Fill in the blank entries in the table.Population data in thousands. $\begin{array} { | c | c | c | c | c | c | c| } \hline \text { Country } & \begin{array} { c } \text { Adult } \\\text { Population }\end{array} & \begin{array} { c } \text { Iubour } \\\text { Force }\end{array} & \text { Errployed } & \text { Uremployed } & \begin{array} { c } \text { Uremployment } \\\text { Rate }\end{array} & \begin{array} { c } \text { Lubour Force } \\\text { Participation } \\\text { Rate }\end{array} \\\hline \text { A } & 109474 & & 62510 & 3500 & & \\\hline \text { B } & & 26870 & & 2577 & & 57.41 \\\hline \text { C } & 70159 & 39591 & & & 9.69 & \\\hline\end{array}$

If the cost of monitoring worker effort is high, then a firm can encourage workers to work hard by paying an efficiency wage because

The labour force equals the