Question 1

"Full employment" is said to exist when the actual unemployment rate is zero.

Accepted Answer

Full employment does not mean zero unemployment; it refers to the situation where all available labor resources are being used in the most economically efficient way, typically allowing for the natural rate of unemployment due to factors like frictional and structural unemployment.

Question 2

The federal government agency that is responsible for determining the inflation rate and the unemployment rate is the Federal Reserve.

Accepted Answer

The Federal Reserve is responsible for conducting monetary policy and regulating financial institutions, but they do not determine the inflation rate or the unemployment rate. These rates are measured and reported by the Bureau of Labor Statistics, which is part of the Department of Labor.

Question 3

For all practical purposes, a discouraged worker is an unemployed person because a discouraged worker is not working.

Accepted Answer

A discouraged worker is not considered unemployed in labor force statistics because they are not actively seeking employment, hence not part of the labor force.

Question 4

If Carlos is waiting to be called back to his job from which he has been temporarily laid off, the Bureau of Labor Statistics will classify him as unemployed.

Accepted Answer

According to the Bureau of Labor Statistics, a person is considered unemployed if they do not have a job, have actively looked for work in the past four weeks, and are currently available for work. If Carlos is not currently working and actively seeking employment while waiting to be called back to his job, he would be classified as unemployed.

Question 5

Jamaal lost his job when a mechanical device replaced people with his skills. If Jamaal's skills are non-transferable, he would be considered to be structurally unemployed.

Accepted Answer

Structurally unemployed individuals have skills that are no longer in demand or not needed in the current labor market, and they cannot easily transfer their skills to other industries or occupations. In this scenario, Jamaal's skills are non-transferable, which makes him structurally unemployed.

Question 6

The base year is always the year in which prices were the lowest.

Accepted Answer

The base year is not always the year in which prices were the lowest. It is typically chosen for convenience in measuring changes in prices over time, and can be any year that is considered a good representation of the economy at that time.

Question 7

The CPI is based on a representative group of goods called the market basket.

Accepted Answer

The CPI is calculated based on a representative group of goods and services that make up the market basket.

Question 8

The CPI in the base year is always equal to 100.

Accepted Answer

The base year by definition has a CPI of 100 since it is used as the reference point to calculate the CPI for other years.

Question 9

A common measure of inflation is the percentage change in the CPI of adjacent years.

Accepted Answer

The CPI (Consumer Price Index) is a commonly used measure of inflation, and one way to calculate inflation is by comparing the percentage change in the CPI from one year to the next. This is known as the inflation rate or the percentage change in the price level. Therefore, the statement is true.

Question 10

Discouraged workers are not counted as unemployed because they are working.

Accepted Answer

Discouraged workers are those who have given up on looking for a job because they believe there are no jobs available for them. They are not considered as unemployed because they are not actively seeking employment.

Question 11

If Jorge is temporarily absent from his regular job because of an industrial dispute, the Bureau of Labor Statistics will classify him as unemployed.

Accepted Answer

The Bureau of Labor Statistics does not classify workers who are temporarily absent from their jobs due to an industrial dispute (such as a strike) as unemployed; instead, they are still considered employed but not at work.

Question 12

If the unemployment rate drops, then it necessarily follows that some of the people who were once unemployed are now employed.

Accepted Answer

The answer of If the unemployment rate drops, then it...

Question 13

The cyclical unemployment rate can never be negative.

Accepted Answer

Cyclical unemployment can be negative if the economy is operating above its potential level, leading to a labor shortage where demand for workers exceeds supply.

Question 14

If the Bureau of Labor Statistics considers Jessica to be a discouraged worker, then she is not counted as unemployed for purposes of computing the official unemployment rate.

Accepted Answer

This is correct, as discouraged workers are not officially counted as unemployed when calculating the unemployment rate by the Bureau of Labor Statistics.

Question 15

The sum of the unemployment rate and the employment rate always equals 100 percent.

Accepted Answer

The unemployment rate and the employment rate do not add up to 100 percent because they are calculated based on different denominators. The employment rate is calculated as a percentage of the total working-age population, while the unemployment rate is calculated as a percentage of the labor force, which excludes those not seeking employment.

Question 16

A worker is ​underemployed​ if she is working at a job for which her skills far exceed the requirements for the job.

Accepted Answer

Underemployment refers to a situation where an individual is working in a job that does not fully utilize their skills, education, or experience, often resulting in the worker being overqualified for their position.

Question 17

Some economists argue that the recent relatively high rate of unemployment has resulted in part from the fact that a part of the workforce has not made the adjustment to new technologies.

Accepted Answer

Some economists believe that technological advancements have led to changes in the labor market, resulting in a mismatch between the skills that workers possess and the skills that are in demand. This mismatch can lead to higher unemployment rates for workers who have not kept up with the changing job requirements.

Question 18

A seamstress who quits her job in Houston and moves to New York where additional seamstresses are needed is said to be frictionally unemployed.

Accepted Answer

Frictional unemployment refers to temporary unemployment that occurs when a worker leaves their current job in search of better opportunities. In this scenario, the seamstress voluntarily left her job in Houston and is actively seeking employment in New York, which makes her an example of frictional unemployment.

Question 19

Structural unemployment results primarily from automation and long-lasting changes in demand.

Accepted Answer

Structural unemployment arises from changes in the economy's structure, typically due to technological advances, shifts in consumer preferences, or changes in global markets. These changes can lead to a mismatch between the skills workers possess and the skills employers need. Therefore, automation and long-lasting changes in demand are the primary causes of structural unemployment.

Question 20

Most unemployed persons fall into the category of job loser.

Accepted Answer

Job loser refers to those who were employed but lost their jobs, which is one of the main reasons for unemployment.

Quiz 6: Macroeconomic Measurements Part I Prices and Unemployment

"Full employment" is said to exist when the actual unemployment rate is zero.

The federal government agency that is responsible for determining the inflation rate and the unemployment rate is the Federal Reserve.

For all practical purposes, a discouraged worker is an unemployed person because a discouraged worker is not working.

If Carlos is waiting to be called back to his job from which he has been temporarily laid off, the Bureau of Labor Statistics will classify him as unemployed.

Jamaal lost his job when a mechanical device replaced people with his skills. If Jamaal's skills are non-transferable, he would be considered to be structurally unemployed.

The base year is always the year in which prices were the lowest.

The CPI is based on a representative group of goods called the market basket.

The CPI in the base year is always equal to 100.

A common measure of inflation is the percentage change in the CPI of adjacent years.

Discouraged workers are not counted as unemployed because they are working.

If Jorge is temporarily absent from his regular job because of an industrial dispute, the Bureau of Labor Statistics will classify him as unemployed.

If the unemployment rate drops, then it necessarily follows that some of the people who were once unemployed are now employed.

The cyclical unemployment rate can never be negative.

If the Bureau of Labor Statistics considers Jessica to be a discouraged worker, then she is not counted as unemployed for purposes of computing the official unemployment rate.

The sum of the unemployment rate and the employment rate always equals 100 percent.

A worker is underemployed if she is working at a job for which her skills far exceed the requirements for the job.

Some economists argue that the recent relatively high rate of unemployment has resulted in part from the fact that a part of the workforce has not made the adjustment to new technologies.

A seamstress who quits her job in Houston and moves to New York where additional seamstresses are needed is said to be frictionally unemployed.

Structural unemployment results primarily from automation and long-lasting changes in demand.

Most unemployed persons fall into the category of job loser.

Quiz 6: Macroeconomic Measurements Part I Prices and Unemployment

"Full employment" is said to exist when the actual unemployment rate is zero.

The federal government agency that is responsible for determining the inflation rate and the unemployment rate is the Federal Reserve.

For all practical purposes, a discouraged worker is an unemployed person because a discouraged worker is not working.

If Carlos is waiting to be called back to his job from which he has been temporarily laid off, the Bureau of Labor Statistics will classify him as unemployed.

Jamaal lost his job when a mechanical device replaced people with his skills. If Jamaal's skills are non-transferable, he would be considered to be structurally unemployed.

The base year is always the year in which prices were the lowest.

The CPI is based on a representative group of goods called the market basket.

The CPI in the base year is always equal to 100.

A common measure of inflation is the percentage change in the CPI of adjacent years.

Discouraged workers are not counted as unemployed because they are working.

If Jorge is temporarily absent from his regular job because of an industrial dispute, the Bureau of Labor Statistics will classify him as unemployed.

If the unemployment rate drops, then it necessarily follows that some of the people who were once unemployed are now employed.

The cyclical unemployment rate can never be negative.

If the Bureau of Labor Statistics considers Jessica to be a discouraged worker, then she is not counted as unemployed for purposes of computing the official unemployment rate.

The sum of the unemployment rate and the employment rate always equals 100 percent.

A worker is ​underemployed​ if she is working at a job for which her skills far exceed the requirements for the job.

Some economists argue that the recent relatively high rate of unemployment has resulted in part from the fact that a part of the workforce has not made the adjustment to new technologies.

A seamstress who quits her job in Houston and moves to New York where additional seamstresses are needed is said to be frictionally unemployed.

Structural unemployment results primarily from automation and long-lasting changes in demand.

Most unemployed persons fall into the category of job loser.

A worker is underemployed if she is working at a job for which her skills far exceed the requirements for the job.