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1. Unemployment Rate = 10%

# Employed = 180 Million

# Working age population = 250 Million

-Calculate:

# Unemployed

# Labor Force

# Not in the Labor Force Labor Force Participation Rate

2. Assume current unemployment is 10%

A) Calculate cyclical unemployment.

B) Is it possible for cyclical unemployment to be negative? Explain

C) Explain what the natural unemployment rate is. Why is it 0%?

D) After a recession ends (expansion begins), would you expect unemployment to increase or decrease? What about natural unemployment?

E) Explain how it might be caused by discouraged workers if the actual unemployment went up after a recession? Refer to the unemployment calculation in your answer.

F) During our current recession, the government decided to increase the unemployment benefits that people received. How would you expect this to affect the unemployment rate? Which type of unemployment?

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Divya Singh
Divya SinghLv10
28 Sep 2019

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Related questions

Assume current unemployment is 10%

A) Calculate cyclical unemployment.

B) Is it possible for cyclical unemployment to be negative? Explain

C) Explain what the natural unemployment rate is. Why isn't it 0%?

D) After a recession ends (expansion begins) would you expect unemployment to increase or decrease? What about natural unemployment?

E) If the actual unemployment went up after a recession explain how it might be caused by discouraged workers. You should reference the unemployment calculation in your answer.

F) During our current recession the government decided to increase the unemployment benefits people received, how would you expect this to affect the unemployment rate? Which type of unemployment?

Unemployment and its types, and the Natural Rate of Unemployment.

1) Frictional unemployment is the result of

A) an economic recession.

B) the economic decline of major industries.

C) the normal process of jobs being created and destroyed.

D) people not getting along (having friction) with their employers.

E) changing weather throughout the year.

2) Bill has graduated with his degree in economics. Through Career Services he submitted his resume to several companies and he will visit them during the next two weeks. Bill is considered

A) not in the labor force.

B) frictionally unemployed.

C) structurally unemployed.

D) cyclically unemployed.

E) employed because he is visiting firms.

3) Structural unemployment includes people who become unemployed from

A) changes in the seasons.

B) normal changes in the labor force.

C) technological changes.

D) changes in the business cycle.

E) going back to school.

4) An employee who is fired from his or her job because he or she lacks the skills required to accomplish the task, is part of ________ unemployment.

A) frictional

B) cyclical

C) unskilled

D) structural

E) withdrawal

 

5) How would you best describe a manufacturing employee who has been fired because he was replaced by a robot (new technology) and does not have the skills necessary to help operate the robot?

A) job leaver

B) entrant/reentrant

C) cyclically unemployed

D) structurally unemployed

E) withdrawal

6) Seasonal unemployment includes people who become unemployed from

A) the seasonal weather patterns.

B) normal changes in the labor force.

C) technological changes.

D) changes in the business cycle.

E) changes in international competition.

7) Cyclical unemployment includes people who become unemployed from

A) changes in the seasons.

B) changes in international competition.

C) technological changes.

D) changes in the business cycle.

E) normal labor market turnover.

 

8) The type of unemployment that arises from a decrease in real GDP is called

A) frictional unemployment.

B) structural unemployment.

C) seasonal unemployment.

D) cyclical unemployment.

E) downturn unemployment.

9) John has been laid off from his job because of a general downturn in the economy. John's unemployment is best classified as

A) cyclical.

B) seasonal.

C) structural.

D) frictional.

E) avoidable.

 

 

10) Full employment means that

A) 100 percent of the labor force have jobs.

B) only those who are willing, able and looking for work are unemployed.

C) the cyclical unemployment rate is zero.

D) the natural unemployment rate is zero.

E) the frictional unemployment rate is zero.

 

11) The natural unemployment rate is the unemployment rate that exists when there is no

A) structural unemployment.

B) frictional unemployment.

C) cyclical unemployment.

D) cyclical or structural unemployment.

E) seasonal unemployment.

12) The natural unemployment rate equals the sum of

A) cyclical and frictional unemployment.

B) cyclical, seasonal, and structural unemployment.

C) frictional, seasonal, and structural unemployment.

D) seasonal and cyclical unemployment.

E) cyclical, frictional, seasonal, and structural unemployment.

 

Answer true or false for each of the following.

1. Most economists want a 0% target for unemployment.

2. The current natural rate of unemployment is thought to be somewhere around 5%.

3. If the economy is above full employment it causes higher than normal unemployment.

4. Inflation can be increased by either an increase in AD or AS.

5. Cyclical unemployment can be caused by a drop in AD or AS.

6. The natural rate of unemployment is associated with high inflation.

7. The core PPI is often used to predict where we are relative to full employment.

8. In a closed economy, inflation represents a decline in average real income.

9. Frictional unemployment is permanent for the labor force, temporary for individuals.

10. It is possible, although unusual, for cyclical unemployment to be negative.

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