Question 1

Who would be included in the labor force?
A)Maggie, who plans to work at the newspaper next year when she turns 16 years old.
B)Lisa, who is unhappy with her current job.
C)Bart, who is a full-time student and uninterested in finding employment.
D)None of the above is correct.

Accepted Answer

The answer of Who would be included in the labor...

Question 2

Which of the following is the correct formula for calculating the labor force participation rate?
A) 
B) 
C) 
D)

Accepted Answer

The answer of Which of the following is the correct...

Question 3

Satchel loses his job and immediately begins looking for another. Other things the same, the unemployment rate
A)increases, and the labor-force participation rate decreases.
B)and the labor-force participation rate both increase.
C)increases, and the labor-force participation rate is unaffected.
D)is unaffected, and the labor-force participation rate decreases.

Accepted Answer

The answer of Satchel loses his job and immediately begins...

Question 4

Matilda just graduated from college. In order to devote all her efforts to college, she didn't hold a job. She is going to tour around the country on her motorcycle for a month before she starts looking for work. Other things the same, the unemployment rate
A)increases, and the labor-force participation rate decreases.
B)and the labor-force participation rate both increase.
C)increases, and the labor-force participation rate is unaffected.
D)and the labor-force participation rate are both unaffected.

Accepted Answer

Matilda did not have a job before or after her motorcycle tour, so her decision does not affect the unemployment rate or the labor-force participation rate. Thus, both rates are unaffected.

Question 5

Table 28-1
Sample Population 
-Refer to Table 28-1. How many in the sample are unemployed?
A)5
B)4
C)3
D)2

Accepted Answer

The correct choice is C) 3. The table indicates that there are 3 individuals in the sample who are unemployed.

Question 6

The labor-force participation rate measures the percentage of the
A)total adult population that is in the labor force.
B)total adult population that is employed.
C)labor force that is employed.
D)labor force that is either employed or unemployed.

Accepted Answer

The labor-force participation rate measures the percentage of the total adult population that is in the labor force, regardless of whether they are employed or unemployed. Choice B only measures the percentage of the adult population that is employed, whereas choices C and D only measure percentages of the labor force.

Question 7

Suppose that the adult population in the country of Atlantis is 115 million. If 80 million people are employed and 5 million are unemployed, then
A)30 million are not in the labor force.
B)35 million are in the labor force.
C)75 million are in the labor force.
D)35 million are not in the labor force.

Accepted Answer

The answer of Suppose that the adult population in the...

Question 8

If an unemployed person quits looking for work, then, eventually the unemployment rate
A)decreases, and the labor-force participation rate is unaffected.
B)and the labor-force participation rate both decrease.
C)is unaffected, and the labor-force participation rate decreases.
D)and the labor-force participation rate are both unaffected.

Accepted Answer

When an unemployed person quits looking for work, they are no longer considered a part of the labor force. This means that both the unemployment rate (which measures the percentage of the labor force that is unemployed) and the labor-force participation rate (which measures the percentage of the working-age population that is in the labor force) will decrease.

Question 9

Sheamous loses his job and decides to sit on the beach rather than look for work during the next few months. Other things the same, the unemployment rate
A)increases, and the labor-force participation rate decreases.
B)increases, and the labor-force participation rate is unaffected.
C)is unaffected, and the labor-force participation rate decreases.
D)and the labor-force participation rate are both unaffected.

Accepted Answer

Sheamous is now considered unemployed and not actively seeking employment, which increases the unemployment rate. Additionally, his decision to not look for work decreases the labor-force participation rate.

Question 10

Sirius has just finished high school and started looking for his first job, but has not yet found one. Other things the same, the unemployment rate
A)and the labor-force participation rate both increase.
B)increases, and the labor-force participation rate is unaffected.
C)is unaffected, and the labor-force participation rate increases.
D)and the labor-force participation rate are both unaffected.

Accepted Answer

The answer of Sirius has just finished high school and...

Question 11

President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that
A)one of them must be lying.
B)both of them could be telling the truth if the labor force, and employment grew at the same rate.
C)both of them could be telling the truth if the labor force grew slower than employment.
D)both of them could be telling the truth if the labor force grew faster than employment.

Accepted Answer

Both statements can be true if the labor force grew faster than employment. This means that more people entered the labor force than were employed, which would result in a higher unemployment rate, but also an increase in the number of people working. Therefore, both candidates could technically be telling the truth, despite giving contradictory statements.

Question 12

Table 28-1
Sample Population 
-Refer to Table 28-1. How many in the sample are in the labor force?
A)11
B)10
C)9
D)8

Accepted Answer

The labor force includes those who are employed and those who are unemployed but actively seeking work. The sample size in the labor force is 10.

Question 13

Which of the following is correct?
A)Labor force = number of employed.
B)Labor force = population - number of unemployed.
C)Unemployment Rate = number of unemployed  (number of employed + number of unemployed)  100.
D)Unemployment Rate = number of unemployed  adult population  100.

Accepted Answer

The answer of Which of the following is correct?
A)Labor force...

Question 14

The unemployment rate is computed as the number of unemployed
A)divided by the labor force, all times 100.
B)divided by the number of employed, all times 100.
C)divided by the adult population, all times 100.
D)times the labor-force participation rate, all times 100.

Accepted Answer

The unemployment rate is calculated by dividing the number of unemployed individuals by the labor force, which consists of both employed and unemployed individuals actively seeking work. This quotient is multiplied by 100 to express the rate as a percentage. Therefore, choice A is correct.

Question 15

The labor-force participation rate tells us the fraction of the population that
A)is able to participate in the labor market.
B)has ever been employed.
C)has chosen to participate in the labor market.
D)has chosen not to participate in the labor market.

Accepted Answer

The labor-force participation rate is the percentage of the working-age population that is either employed or actively seeking employment. Therefore, it represents those who have chosen to participate in the labor market.

Question 16

Suppose there are a large number of men who used to work or seek work who now no longer do either. Other things the same, this makes
A)the number of people unemployed rise but does not change the labor force.
B)the number of people unemployed rise but makes the labor force fall.
C)both the number of people unemployed and the labor force fall.
D)the number of people unemployed fall but does not change the labor force.

Accepted Answer

The answer of Suppose there are a large number of...

Question 17

Who is not included in the labor force by the Bureau of Labor Statistics?
A)Anita, who is on temporary layoff
B)Lauren, who has retired and is not looking for work
C)Raymond, who does not have a job but has applied for several in the last week
D)None of the above is correct.

Accepted Answer

The Bureau of Labor Statistics does not consider retired individuals who are not actively seeking employment as part of the labor force. Therefore, Lauren who has retired and is not looking for work is not included in the labor force. Anita, who is on temporary layoff, and Raymond, who does not have a job but has applied for several in the last week, are both considered part of the labor force.

Question 18

Noah is an unpaid stay-at-home father who is not currently searching for paid work. Pete is a full-time student who is not looking for a job. Who is included in the labor force by the Bureau of Labor Statistics?
A)only Noah
B)only Pete
C)both Noah and Pete
D)neither Noah nor Pete

Accepted Answer

The labor force includes individuals who are currently employed or actively seeking employment. Since neither Noah nor Pete are actively seeking employment, they are not included in the labor force according to the Bureau of Labor Statistics.

Question 19

The labor-force participation rate is computed as
A)(Employed  Adult Population)  100.
B)(Employed  Labor Force)  100.
C)(Labor Force  Adult Population)  100.
D)(Adult Population  Labor Force)  100.

Accepted Answer

The answer of The labor-force participation rate is computed as
A)(Employed...

Question 20

The Bureau of Labor Statistics defines the unemployment rate as the percentage of
A)those unemployed relative to those employed.
B)the labor force that is unemployed.
C)the adult population that is unemployed.
D)the adult population that is unemployed or not in the labor force.

Accepted Answer

The unemployment rate is defined as the percentage of the labor force that is unemployed, which includes individuals who are actively seeking employment but unable to find it. Choice A refers to the employment rate, not the unemployment rate. Choice C and D do not accurately capture the definition of the unemployment rate.

Quiz 28: Unemployment and Its Natural Rate

Who would be included in the labor force?

Which of the following is the correct formula for calculating the labor force participation rate?

Satchel loses his job and immediately begins looking for another. Other things the same, the unemployment rate

Matilda just graduated from college. In order to devote all her efforts to college, she didn't hold a job. She is going to tour around the country on her motorcycle for a month before she starts looking for work. Other things the same, the unemployment rate

Table 28-1 Sample Population -Refer to Table 28-1. How many in the sample are unemployed?

The labor-force participation rate measures the percentage of the

Suppose that the adult population in the country of Atlantis is 115 million. If 80 million people are employed and 5 million are unemployed, then

If an unemployed person quits looking for work, then, eventually the unemployment rate

Sheamous loses his job and decides to sit on the beach rather than look for work during the next few months. Other things the same, the unemployment rate

Sirius has just finished high school and started looking for his first job, but has not yet found one. Other things the same, the unemployment rate

President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that

Table 28-1 Sample Population -Refer to Table 28-1. How many in the sample are in the labor force?

Which of the following is correct?

The unemployment rate is computed as the number of unemployed

The labor-force participation rate tells us the fraction of the population that

Suppose there are a large number of men who used to work or seek work who now no longer do either. Other things the same, this makes

Who is not included in the labor force by the Bureau of Labor Statistics?

Noah is an unpaid stay-at-home father who is not currently searching for paid work. Pete is a full-time student who is not looking for a job. Who is included in the labor force by the Bureau of Labor Statistics?

The labor-force participation rate is computed as

The Bureau of Labor Statistics defines the unemployment rate as the percentage of