ch 7: unemployment

Question 1

types of unemployment

Answer 1

structural
frictional
cyclical

Question 2

structural unemployment

Answer 2

caused by changes in the industrial makeup of the economy
creative destruction

Question 3

creative destruction

Answer 3

introduction of new products and technology (consumer demands and outsourcing)

Question 4

ways to reduce structural unemployment

Answer 4

workers must retrain, reeducate, relocate, or change expectations for work and pay

Question 5

frictional unemployment (short term)

Answer 5

Unemployment caused by delays in matching available jobs and workers
EX: recent college grad

Question 6

frictional unemployment causes

Answer 6

information availability any factors that shorten jobs searches also decrease unemployment

Question 7

cyclical unemployment contraction

Answer 7

unemployment caused by economic downturns

Question 8

cyclical unemployment cause

Answer 8

an unhealthy economy

Question 9

US recession of 08-09

Answer 9

certain industries were hit hard (housing)
adjustment lags
Gov’t policy

Question 10

work eligible population

Answer 10

civilian, non-institutionalized, 16+ labor force looking for work

Question 11

who is not considered labor force?

Answer 11

military
retired
full-time students
stay at home parent
discouraged worker

Question 12

Goal of unemployment

Answer 12

4-6%

Question 13

Civillian Labor Force

Answer 13

Unemployed + Employed

Question 14

Unemployment Rate (UR)

Answer 14

number of unemployed / labor force * 100