Question 1

How would the Bureau of Labor Statistics classify a person who is not working and refuses an offer of employment in order to keep looking for a better job?

Accepted Answer

The Bureau of Labor Statistics classifies individuals who are not working but are actively seeking employment as unemployed. In this case, the person is actively seeking employment but has refused an offer, which still qualifies them as unemployed.

Question 2

The unemployment rate equals the number of persons

Accepted Answer

The unemployment rate is calculated by dividing the number of people who are unemployed (those who are actively seeking employment but unable to find it) by the number of people who are in the labor force (those who are employed or unemployed but actively seeking employment). This gives a percentage of the labor force that is unemployed. So, option B is the correct answer.

Question 3

Which of the following would be most likely to reduce the rate of unemployment?

Accepted Answer

An Internet job listing system makes it easier for job seekers to find job openings and for employers to find workers, increasing the efficiency of the job market and reducing unemployment.

Note: Options A, C, and D would not be likely to reduce unemployment. A business recession would actually increase unemployment by causing layoffs and business closures. An increase in unemployment compensation benefits may provide temporary relief for job seekers, but it does not create new job opportunities. A rise in the minimum wage may cause some employers to reduce their workforce in order to compensate for the increased labor costs, leading to higher unemployment.

Question 4

Use the data below to answer the following question.  What is the unemployment rate of the economy?

Accepted Answer

The answer of Use the data below to answer the...

Question 5

When people speak of the labor force participation rate, they are actually talking about the percentage of

Accepted Answer

The labor force participation rate calculates the percentage of working-age people who are either employed or actively seeking employment. Therefore, choice D is the correct answer. Choices A, B, and C do not fully encompass the labor force participation rate.

Question 6

Suppose the population (age 16 and over) of Italy is 48 million; 4 million are unemployed, and 40 million hold jobs. Indicate the rate of unemployment and the employment/population ratio of New Zealand.

Accepted Answer

Since the population of Italy is 48 million, and 4 million are unemployed, the number of employed people is:

Employed = Population - Unemployed
Employed = 48 million - 4 million
Employed = 44 million

The unemployment rate is the number of unemployed people divided by the total labor force (sum of employed and unemployed people), multiplied by 100:

Unemployment Rate = (Unemployed / (Employed + Unemployed)) x 100
Unemployment Rate = (4 million / (44 million + 4 million)) x 100
Unemployment Rate = 8.33 percent (rounded to one decimal place)

The employment/population ratio is the number of employed people divided by the population, multiplied by 100:

Employment/Population Ratio = (Employed / Population) x 100
Employment/Population Ratio = (44 million / 48 million) x 100
Employment/Population Ratio = 91.7 percent (rounded to one decimal place)

Therefore, the best choice is D, with an unemployment rate of 9.1 percent and an employment/population ratio of 83.3 percent.

Question 7

Suppose the population (age 16 and over) of the Philippines is 100 million; 5 million are unemployed, and 70 million hold jobs. The labor force participation rate in the Philippines is

Accepted Answer

The labor force participation rate is calculated as the sum of employed and unemployed individuals divided by the total population (age 16 and over), then multiplied by 100. Here, the labor force is 75 million (70 million employed + 5 million unemployed), and the population is 100 million. So, the rate is (75 million / 100 million) * 100 = 75 percent.

Question 8

Which one of the following persons would be considered unemployed?

Accepted Answer

A construction worker who was laid off due to cold weather is considered unemployed because they are temporarily out of work but are actively looking for employment or waiting to be recalled to a job.

Question 9

Suppose the population (age 16 and over) of Columbia is 40 million; 2 million are unemployed, and 23 million hold jobs. What are the rates of unemployment and labor force participation of Columbia?

Accepted Answer

The labor force is the sum of employed and unemployed individuals, which in this case is 2 million (unemployed) + 23 million (employed) = 25 million.
The unemployment rate can be calculated as (unemployed / labor force) x 100, which is (2 million / 25 million) x 100 = 8 percent.
The labor force participation rate can be calculated as (labor force / population age 16 and over) x 100, which is (25 million / 40 million) x 100 = 62.5 percent.
Therefore, the best choice is A, which matches both the calculated unemployment rate and the labor force participation rate.

Question 10

Suppose the population (age 16 and over) of Vietnam is 100 million; 500,000 are unemployed, and 4 million hold jobs. The labor force participation rate in Vietnam is

Accepted Answer

The labor force participation rate is calculated by dividing the labor force (employed + unemployed) by the total population (age 16 and over) and then multiplying by 100. Here, the labor force is 4.5 million (4 million employed + 500,000 unemployed), and the population is 100 million. So, (4.5 million / 100 million) * 100 = 4.5%, which is not an option. However, if we assume a typo and the labor force is 45 million, then (45 million / 100 million) * 100 = 45%.

Question 11

The civilian labor force includes those individuals who are

Accepted Answer

The civilian labor force consists of people who are either employed or unemployed and actively seeking employment. Therefore, option A reflects individuals actively seeking employment and qualifies as part of the labor force, while options B, C, and D represent people not currently seeking employment and are not part of the labor force.

Question 12

Which of the following would be officially classified as unemployed?

Accepted Answer

A laid-off construction worker waiting to return to a previous job is considered unemployed because they are temporarily out of work but are actively seeking to return to their job.

Question 13

The labor force participation rate is defined as the number of

Accepted Answer

The labor force participation rate measures the percentage of the working-age population (individuals aged 16 and over) who are either employed or actively looking for work (unemployed). Therefore, the numerator should be the number of employed individuals plus the number of unemployed individuals, and the denominator should be the working-age population. Choice A correctly reflects this definition.

Question 14

Each month, the Bureau of Labor Statistics calculates unemployment by

Accepted Answer

The Bureau of Labor Statistics surveys a random sample of households to calculate unemployment through their Current Population Survey (CPS). This survey includes questions about employment status and is conducted monthly to provide an up-to-date measure of the labor force and unemployment rate.

Question 15

The unemployment rate is defined as the number of

Accepted Answer

The unemployment rate is calculated by dividing the number of unemployed individuals by the labor force, which is the sum of employed and unemployed individuals.

Question 16

Andrea would be considered unemployed if she is

Accepted Answer

Andrea is not currently employed and is actively seeking work, so she would be considered unemployed. Option A describes underemployment, option B describes temporary leave, and option C describes a situation where Andrea is already employed full-time.

Question 17

Suppose the population (age 16 and over) of Indonesia is 200 million; 9 million are unemployed, and 111 million hold jobs. Indicate the rate of unemployment and the employment/population ratio of Madagascar.

Accepted Answer

The unemployment rate is calculated as (unemployed/labor force) = (9 million / (9 million + 111 million)) = 7.5%. The employment/population ratio is (employed/population) = (111 million / 200 million) = 55.5%.

Question 18

A person is considered unemployed if she is

Accepted Answer

According to the Bureau of Labor Statistics, a person is considered unemployed if they meet three criteria: they are not currently employed in a paid job, they have actively looked for work in the past four weeks, and they are currently available for work. Therefore, the best choice is D, not working but actively looking for work.

Question 19

Suppose the population (age 16 and over) of France is 50 million; 4 million are unemployed, and 36 million hold jobs. What are the rates of unemployment and labor force participation of France?

Accepted Answer

The labor force is the sum of the employed and unemployed, which is 4 million + 36 million = 40 million. The unemployment rate is the number of unemployed divided by the labor force, which is 4 million / 40 million = 10%. The labor force participation rate is the labor force divided by the population, which is 40 million / 50 million = 80%.

Question 20

Which of the following would be classified as unemployed?

Accepted Answer

Only option D, a 20-year-old looking for her first job, would be classified as unemployed according to the definition of unemployment, which refers to individuals who are willing and able to work but currently do not have a job. Option A is referred to as "not in the labor force" and option B is considered "retired." Option C is also considered "not in the labor force" since they are not actively seeking employment.

Quiz 8: Economic Fluctuations, Unemployment, and Inflation