ECO 205 - Quiz 05

1. The natural rate of unemployment consists of:

• A.Frictional and structural unemployment

• B.Only cyclical unemployment
  
  

• C.Frictional, structural, and cyclical unemployment

• D.No unemployment at all

2.Cyclical unemployment occurs due to:

• A.Changes in industry structure

• B.Normal labor market turnover

• C.Seasonal changes

• D.Economic recessions

3.Which of the following is considered frictional unemployment?

• A.A recent graduate looking for their first job

• B.A worker laid off during a recession

• C.A factory worker replaced by automation

• D.A farmer unemployed due to seasonal changes

4.Why might the unemployment rate understate the true level of unemployment?

• A.It includes discouraged workers

• B.It ignores self-employed individuals

• C.It only counts people over 25

• D.It counts part-time workers as fully employed

5.What causes structural unemployment?

• A.Business cycle fluctuations

• B.Lack of job search skills

• C.Mismatch between workers’ skills and job requirements

• D.Temporary layoffs

6.Which of the following increases the natural rate of unemployment?

• A.An economic boom

• B.Higher minimum wage laws

• C.Better job matching technology

• D.A decline in population

7.If both the unemployment rate and job vacancy rate are high, this indicates:

• A.Frictional unemployment

• B.Structural unemployment

• C.Cyclical unemployment

• D.Seasonal unemployment

8.Analyzing the labor force participation rate helps understand:

• A.Only the employed population

• B.Trends in discouraged workers

• C.Total unemployment

• D.Wage inflation

9.Structural reforms in education aim to reduce:

• A.Frictional unemployment

• B.Cyclical unemployment

• C.Structural unemployment

• D.Seasonal unemployment

10.Which is a criticism of using GDP growth to evaluate employment health?

• A.GDP measures income distribution

• B.GDP directly tracks unemployment

• C.GDP may grow without improving employment significantly

• D.GDP ignores economic productivity