Unemployment

Unemployment

Multiple Choice

The natural rate of unemployment is:

• all the answers are correct

• an average value

• short run concept

• a proof of labour market perfection

Multiple Choice

The natural rate of unemployment is equal to the rate of job finding minus the rate of job separation.

• True

• False

Multiple Choice

The labor market is in a steady state, if the unemployment rate is neither rising nor falling.

• True

• False

Multiple Choice

In the economy 10% of unemployed finds job every month and 0,5% of employed lose their jobs each month. Under such conditions:

• the average spell of unemployment last 10 months and the steady-state rate of unemployment is about 5%

• the average spell of unemployment last 5 months and the steady-state rate of unemployment is about 5%

• the average spell of unemployment last 10 months and the steady-state rate of unemployment is about 10%

• the average spell of unemployment last 5 months and the steady-state rate of unemployment is about 10%

Multiple Choice

Frictional unemployment exists because:

• all the answers are correct

• workers have different preferences and abilities and jobs have different attributes

• the geographic mobility of workers is not instantaneous

• flow of information about job candidates and job vacancies is imperfect

Multiple Choice

The sectoral shift is a change in the composition of demand among industries or regions.

• True

• False

Multiple Choice

Which of the given public policies is not aimed at decreasing frictional unemployment:

• unemployment insurance

• employment agencies disseminating information about job vacancies

• publicly funded retraining programs

• none of the answers is correct

Multiple Choice

Structural unemployment exists when real wage is stuck below the market-clearing level.

• True

• False

Multiple Choice

Jobs rationing occurs when labour supply is higher than demand.

• True

• False

Multiple Choice

Among the causes of wage-rigidity we won't find:

• monopoly power of employers

• minimum-wage laws

• monopoly power of unions

• efficiency wages

Open Questions

• Group 1: Is this steady-state desirable for labour market in every country?

• Group 2: How the minimum-wage laws affect unemployment?

• Group 3: How the unions and collective bargaining affect unemployment?

• Group 4: How the efficiency-wage theories explain wages above equilibrium level?

• Group 5: What are the similarities and differences between labour market in the United States and the European Union?

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