Question : 11) The total amount of unemployment in the economy decreases : 1384490

11) The total amount of unemployment in the economy decreases when the flows of individuals

A) into unemployment are positive.

B) into unemployment exceed the flows out of unemployment.

C) out of unemployment exceed the flows into unemployment.

D) out of unemployment are negative.

E) out of unemployment are equal to the flows into unemployment.

12) The total amount of unemployment in the economy is constant when the flows of individuals

A) into unemployment are positive.

B) into unemployment exceed the flows out of unemployment.

C) out of unemployment exceed the flows into unemployment.

D) out of unemployment are negative.

E) out of unemployment are equal to the flows into unemployment.

13) One reason that economists are interested in gross flows in the labour market as well as in the stock of unemployment is that examining the gross flows

A) gives a better estimate of NAIRU.

B) gives a good estimate of the incidence of unemployment.

C) excludes only the new entrants and retirements of people moving into and out of the labour force.

D) in relation to the stock of unemployment can indicate the amount of time the average person spends unemployed.

E) provides a better indication of the total number of people unemployed at any one time.

14) One reason that economists are interested in the gross flows in the labour market as well as the stocks of unemployed is that examining the flows

A) gives us a better estimate of NAIRU.

B) gives more insight into the amount of labour-market turnover.

C) provides a better indication of the total number of people unemployed at any one time rather than just looking at the stocks.

D) provides a good estimate of the overall level of employment.

E) provides the only reliable way to measure cyclical unemployment.

15) Suppose John finishes school and immediately gets a part-time job. The measured unemployment rate would

A) rise because he was not in the labour force when in school.

B) not change since he is now employed.

C) fall because he was considered unemployed when in school.

D) fall because he was not in the labour force when in school.

E) not change because part-time jobs aren’t counted in the labour force.

16) When the actual unemployment rate is equal to the NAIRU, we can say that

A) all remaining unemployment is structural.

B) the economy is experiencing no lost output due to frictional unemployment.

C) the economy is at full employment.

D) frictional unemployment is zero.

E) frictional and structural unemployment are both zero.

17) When one worker is unemployed for one year,

A) we no longer include that worker in labour-force statistics.

B) there may be significant personal costs, but there is no cost to the economy.

C) it is not a problem because as soon as the worker is employed again, any loss of output goes away.

D) there is no effect on national income.

E) the output that the worker would have produced is lost forever.

18) Suppose in a given month the flow out of unemployment equals 300 000 per month, and the flow into unemployment equals 330 000 per month. The rate of unemployment has

A) increased by 30 000.

B) decreased by 30 000.

C) increased by 10%.

D) decreased by 10%.

E) Not enough information to determine.

19) Suppose the official rate of unemployment reported by Statistics Canada is 7.2%. One reason that this is likely to be an understatement of the amount of “true” unemployment is that

A) the official rate is a measure of gross flows into and out of unemployment rather than net flows.

B) discouraged workers who have given up searching for a job, but would take one if offered, are not included.

C) the official rate is a measure of net flows into and out of unemployment rather than gross flows.

D) Statistics Canada does not have a good measure of the numbers of people entering the labour force.

E) seasonal workers are not included at all in the official data.

20) Suppose the official rate of unemployment reported by Statistics Canada declines from one month to the next from 7.5% to 7.2%, but we also know that the stock of unemployed workers has not changed. How is this possible?

A) The labour force has declined due to out-migration of working-age people.

B) The labour force has grown as previously discouraged workers re-start their job-search process as unemployed individuals.

C) Some individuals who were previously outside the labour force have joined the labour force and immediately found jobs.

D) We have gone from a month with high seasonal unemployment to a month with low seasonal unemployment.

E) We have gone from a month with low seasonal unemployment to a month with high seasonal unemployment.