Unemployment Quiz

Which phase of the business cycle is most likely to be associated with cyclical unemployment?

• Peak

• Downturn

• Upturn

• Expansion

what might lead to cyclical unemployment?

• An increase in aggregate supply

• A decrease in aggregate demand

• an increase in AD

What is the likely impact on cyclical unemployment if there is a decrease in consumption?

• Cyclical unemployment may decrease

• Cyclical unemployment may increase

• No impact on cyclical unemployment

• Seasonal Unemployment will grow

What is the expected effect on cyclical unemployment when there is an increase in tax?

• may decrease

• may increase

• No impact

• structural Unemployment will grow

If there is an increase in savings, what is the likely effect on cyclical unemployment?

• may decrease

• may increase

• No impact

• becomes constant

How does an increase in imports, ceteris paribus, affect cyclical unemployment?

• may decrease

• may increase

• No impact

• becomes constant

What is the expected impact on cyclical unemployment with an increase in exports, ceteris paribus?

• may decrease

• may increase

• No impact

• becomes constant

Ceteris paribus, what happens to cyclical unemployment when there is an increase in investment?

• may decrease

• may increase

• No impact

• becomes constant

What is the effect on cyclical unemployment when government spending increases, ceteris paribus?

• may decrease

• may increase

• No impact

• becomes constant

What is likely to happen during a downturn in the business cycle?

• The amount of labour required in an economy increases.

• Jobs are created, leading to a decrease in cyclical unemployment.

• Economic activity declines, leading to job losses and cyclical unemployment.

• Firms are confident in hiring new workers immediately.