Chapter 20

Question 1

Who measures unemployment?

Answer 1

The Bureau of Labor Statistics (BLS)

Question 2

How often does the BLS measure unemployment?

Answer 2

Every month

Question 3

Employed

Answer 3

• Ppl who worked as paid employees
• worked in their own business
• worked as unpaid workers in a family member’s business
• full and part time
• Also includes those who are not working but had jobs from which they were temporarily absent because of vacation, illness, bad weather etc.

Question 4

Unemployed

Answer 4

• Not employed and were available for work and had tried to find employment during the previous four weeks
• Those waiting to be recalled to a job where they were laid off

Question 5

Not in the labor force

Answer 5

Those who don’t fit either of the first two categories, such as full-time students, homemakers, and retirees

Question 6

Labor force

Answer 6

the sum of the employed and the unemployed

Question 7

Labor force formula

Answer 7

Labor force=number of employed+ number of unemployed

Question 8

Unemployment rate

Answer 8

the percentage of the labor force that is unemployed

Question 9

Unemployment rate formula

Answer 9

Unemployment rate=number of unemployed/labor force X 100

Question 10

Labor-force participation rate

Answer 10

the percentage of the total adult population of the U.S. that is in the labor force

Question 11

Labor-force participation rate formula

Answer 11

Labor-force participation rate=labor force/adult population X 100

Question 12

Marginally attached workers

Answer 12

persons who currently are neither working nor looking for work but indicate that they want and are available for a job and have looked for work sometime in the recent past

Question 13

Discouraged workers

Answer 13

are marginally attached workers who have given a job-market-related reason for not currently looking for a job

Question 14

Persons employed part-time for economic reasons

Answer 14

those who wants and are available for full-time work but have had to settle for a part-time schedule

Question 15

Frictional unemployment

Answer 15

unemployment that results because it takes time for workers to search for the jobs that best suit their tastes and skills

Question 16

Structural unemployment

Answer 16

unemployment that results because the number of jobs available in some labor markets is insufficient to provide a job for everyone who wants one

Question 17

Unemployment insurance

Answer 17

a government program that partially protects workers’ incomes when they become unemployed (the unemployed who quit their jobs, were fired for cause, or just entered the labor force are not eligible)

Question 18

A union

Answer 18

a worker association that bargains with employers over wages, benefits, and working conditions

Question 19

Collective bargaining

Answer 19

the process by which unions and firms agree on the terms of employment

Question 20

Right-to-work laws

Answer 20

laws that bar a union and employer from requiring workers to financially support the union

Question 21

Efficiency wages

Answer 21

above-equilibrium wages paid by firms to increase worker productivity

Question 22

4 reasons for unemployment

Answer 22

1. frictional-it takes time for workers to search for jobs that best suit their tastes and skills
2. minimum-wage laws
3. market power of unions
4. theory of efficiency-firms find it profitable to pay wages above the equilibrium level