# Econ 260 CH 07 Study Plan

## Unlock all answers in this set

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Labor force
(Adult, non-institutionalized, non-military population) x (labor force participation rate) = labor force
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(labor force) - (unemployment) = employed adults
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Determine unemployment rate from unemployed adults and labor force
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labor force
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The 188 million difference between the adult population and the combined total of people who are employed and unemployed can be classified as
not in the civilian labor force
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labor force participation rate
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The labor force is equal to the number of employed plus the number of unemployed.
True
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Individuals who have stopped looking for a job because they are convinced they will not find a suitable one are classified as unemployed.
False
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According to the Bureau of Labor? Statistics, an unemployed individual whose employment was involuntarily terminated is classified as a
Job Loser
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_____ persons are adults who are willing and able to work and are actively looking for a job but have not found one. The unemployment rate is computed by dividing the number of unemployed by the total ____ which is equal to those who are employed plus those who are unemployed.
Unemployed labor force
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The unemployed are classified as ____, _____, _____, and _____ to the labor force. The flow of people departing jobs and people acquiring jobs determines the stock of the unemployed as well as the stock of the employed.
Job losers Re-entrants Job leavers New entrants
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The duration of unemployment affects the unemployment rate. If the duration of unemployment? increases, the measured unemployment rate will _____, , even though the number of unemployed workers may remain the same.
Increase
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Whereas overall labor force participation on net has risen only modestly since World War? II, there has been a major increase in _____ labor force participation.
Female
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Suppose that a nation has a labor force of 100 people. In? January, Amy,? Barbara, Carine, and Denise are? unemployed; in? February, those four find? jobs, but? Evan, Francesco,? George, and Horatio become unemployed. Suppose further that every? month, the previous four who were unemployed find jobs and four different people become unemployed. Throughout the? year, however, the same three people β ?Ito, Jack, and Kelleyβ continually remain unemployed because their skills are a poor match with? employers' requirements. Calculate this? nation's frictional unemployment rate.
4.00% Frictional unemployment rate = [(Frictional Unemployment)/(Labor Force)] x 100
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Frictional? unemployment
Unemployment due to the fact that workers must search for appropriate job offers. This takes? time, and so they remain temporarily unemployed.
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Calculate this nation's structural unemployment rate
3% (the same 3 remained unemployed constantly so I guessed =/)
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Structural Unemployment
Unemployment resulting from a poor match of? workers? abilities and skills with current requirements of employers.
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Calculate the? nation's unemployment rate
7.00% [(Frictional + Structural)/(Labor Force)] x 100
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Internet job? sites, like? Monster.com, have led potential employees to find jobs via the internet almost instantly. This has caused
a fall in frictional unemployment.
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The type of unemployment that rises as the economy goes into a recession is called
cyclical
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By providing information and reducing the costs of job? search, the? Internet's impact on the job market is to reduce
frictional unemployment
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The economy of Finlandia is at full employment when
there is some unemployment due to friction in the labor? market, but there is no cyclical unemployment.
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Which of the following measures will lower the natural rate of? unemployment?
More high school graduates enter college without looking for employment right away.
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Consider an economy where the natural rate of unemployment is equal to 3?%. If the actual unemployment rate is equal to 6?%, then
cyclical unemployment rate is 3%
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Full employment means
there is a level of unemployment consistent with? "normal" frictions in the labor market.
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Unemployment due to the fact that workers must search for appropriate job offers is called frictional unemployment.
True
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Structural unemployment is related to the movement of workers from? low-paying to? high-paying jobs.
False
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Cyclical unemployment results from business recessions.
True
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When the economy is at full? employment, the unemployment rate is zero.
False
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The natural rate of unemployment includes