Ch 15 Unemployment

Question 1

What is the natural rate of unemployment?

Answer 1

It refers to the amount of unemployment that the economy normally experiences.

This is why unemployment rate can never reach 0%.

Question 2

refers to the year-to-year fluctuations in unemployment around its natural rate, and it is closely associated with the short-run ups and downs of economic activity.

Answer 2

Cyclical unemployment

Question 3

What measures the percentage of the total adult population of the United States that is in the labor force?

Answer 3

Labor force participation rate

Question 4

individuals who would like to work but have given up looking for a job.

They are not included in the calculation of unemployment

Answer 4

discouraged workers

Question 5

unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills; moving from one job to another

Answer 5

frictional unemployment

Question 6

unemployment resulting from industrial reorganization, typically due to technological change, rather than fluctuations in supply or demand.

Answer 6

structural unemployment