Question 1

Almost nine-tenths of all spells of unemployment end when the unemployed person finds a job.

Accepted Answer

Many spells of unemployment end when the person leaves the labor force, not necessarily when they find a job. Factors such as discouragement, retirement, returning to education, or personal issues can also end unemployment spells.

Question 2

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.

Accepted Answer

This statement is true. The reported unemployment rate only accounts for those who are actively seeking employment and cannot find a job, not those who are working but not reporting their earnings. Therefore, individuals who are working "under the table" are not counted as employed, which causes the reported unemployment rate to be higher than it would be if all employed individuals were counted.

Question 3

Almost half of all spells of unemployment end when the unemployed person leaves the labor force.

Accepted Answer

According to research, approximately 45% of unemployment spells end when individuals drop out of the labor force by either retiring, returning to school, or giving up their job search altogether.

Question 4

The Bureau of Labor Statistics' U-1 measure of joblessness is smaller than its U-6 measure of joblessness.

Accepted Answer

The U-1 measure of joblessness only counts people who have been unemployed for 15 weeks or longer, while the U-6 measure includes not only the officially unemployed but also marginally attached workers and those employed part-time for economic reasons, making U-6 a broader and typically higher measure of joblessness.

Question 5

The Bureau of Labor Statistics' U-5 measure of joblessness is the official unemployment rate.

Accepted Answer

The Bureau of Labor Statistics' U-5 measure of joblessness is not the official unemployment rate. The U-5 measure includes people who are marginally attached to the labor force but haven't looked for a job in the past four weeks, as well as those who are employed part-time but would prefer full-time work. The official unemployment rate is calculated using the U-3 measure, which only includes people who are without work, seeking work, and available for work.

Question 6

It is best to view the official unemployment rate as a useful but imperfect measure of joblessness.

Accepted Answer

The official unemployment rate, also known as the U-3 rate, only captures individuals who are actively seeking employment and cannot find it. It does not account for people who have given up looking for work or those who are underemployed. Additionally, it may not reflect the true extent of joblessness during economic downturns or in certain demographic groups. Despite these limitations, it is still a widely used indicator of the health of the labor market.

Question 7

The Bureau of Labor Statistics' U-1 measure of joblessness is larger than its U-6 measure of joblessness.

Accepted Answer

The U-6 measure of joblessness includes individuals who are unemployed, marginally attached to the labor force, and working part-time for economic reasons. This generally results in a higher percentage than the U-1 measure, which only includes unemployed individuals who have been out of work and actively seeking employment for at least 15 weeks.

Question 8

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.

Accepted Answer

This is an accurate definition of marginally attached workers provided by the Bureau of Labor Statistics.

Question 9

Discouraged workers are people who want to work but have given up trying to find a job after an unsuccessful search.

Accepted Answer

That is the definition of discouraged workers.

Question 10

The Bureau of Labor Statistics' U-1 measure of joblessness includes only very long-term unemployed.

Accepted Answer

The answer of The Bureau of Labor Statistics' U-1 measure...

Question 11

The Bureau of Labor Statistics' U-5 measure of joblessness includes marginally attached workers.

Accepted Answer

The U-5 measure includes all unemployed workers, plus marginally attached workers who are willing and able to work but have not searched for a job within the past four weeks.

Question 12

Because people move into and out of the labor force so often,statistics on unemployment are difficult to interpret.

Accepted Answer

This statement is true. The unemployment rate only takes into account people who are actively seeking employment and do not have a job. It does not include those who are not in the labor force (such as retirees, stay-at-home parents, or students) or those who have given up looking for work. As a result, changes in the unemployment rate can be influenced by fluctuations in the number of people entering or leaving the labor force, rather than changes in the actual availability of jobs.

Question 13

If people who report being unemployed are not,in fact,trying hard to find a job,then the reported unemployment rate will be baised upward.

Accepted Answer

If people who report being unemployed are not actively seeking employment, they are not considered part of the labor force and are not included in the unemployment rate calculation. However, if they falsely report being unemployed without actively seeking employment, the reported unemployment rate will be inflated.

Question 14

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.

Accepted Answer

People like Rupert, who are actively applying for jobs (even if selectively), are counted as part of the labor force and therefore contribute to the unemployment rate, not reduce it. The reported unemployment rate includes individuals actively seeking employment.

Question 15

The unemployment rate reported by the Bureau of Labor Statistics clearly understates the true unemployment rate.

Accepted Answer

The answer of The unemployment rate reported by the Bureau...

Question 16

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.

Accepted Answer

This statement accurately reflects the definition of discouraged workers according to the Bureau of Labor Statistics.

Question 17

The Bureau of Labor Statistics' U-2 measure of joblessness includes job losers and job leavers.

Accepted Answer

The Bureau of Labor Statistics' U-2 measure of joblessness includes only job losers, not job leavers.

Question 18

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.

Accepted Answer

This phenomenon is known as "discouraged workers" and can lead to an underreporting of unemployment rates. These individuals are not counted as unemployed because they are not actively seeking employment, but they are still part of the potential workforce.

Question 19

The Bureau of Labor Statistics' U-4 measure of joblessness includes discouraged workers.

Accepted Answer

The U-4 measure of joblessness is defined as total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers. Therefore, it includes discouraged workers.

Question 20

The Bureau of Labor Statistics' U-3 measure of joblessness is the official unemployment rate.

Accepted Answer

The U-3 measure of joblessness is indeed the official unemployment rate as reported by the Bureau of Labor Statistics in the United States.

Quiz 28: Unemployment