question

1930s

answer

time period where unemployment rates in the United States were the highest

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The Bureau of Labor Statistics

answer

a federal agency that publishes the U.S. unemployment figures

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The end of WWII

answer

The lowest registered unemployment rate in the United States

question

RATE OF UNEMPLOYMENT

answer

the number of unemployed / number of people in the civilian labor force

question

OFFICIAL UNEMPLOYMENT RATES

answer

fails to include discouraged workers (workers who are no longer actively seeking work)

question

CIVILIAN LABOR FORCE

answer

comprised of the unemployed and the employed

question

UNEMPLOYED

answer

not working but looking for a job

question

RATE OF UNEMPLOYMENT

answer

divide the number of unemployed by the number of people in the labor force unemployed / current labor force

question

LABOR FORCE PARTICIPATION RATE

answer

The percentage of non-institutionalized working - age individuals who are employed or seeking employment

question

LABOR FORCE

answer

employed persons + unemployed persons

question

LABOR CLASSIFICATION

answer

The U.S. Department of Labor classifies all individuals in the U.S as either: 1. employed 2. unemployed 3. not in the labor force

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A RE-ENTRANT

answer

a person who previously had a full-time job has been paroled from prison and has applied for a job

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JOB LOSERS

answer

the category of unemployed individuals which makes up the greatest share of those who are enemployed

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STOCK VARIABLE

answer

unemployed people

question

A FLOW

answer

the number of people that are fired in a month

question

extending unemployment

answer

When there is an increase in the duration of unemployment, the U.S. Congress typically responds by benefits

question

1960

answer

in the U.S. the labor-force participation rate has been increasing for FEMALES since what year?

question

JOB LOSER

answer

if a person is laid off from a job he is considered this by the Bureau of Labor Statistics

question

JOB LEAVER

answer

if I voluntarily end my employment

question

JOB LOSER

answer

Largest category of the Unemployed are:

question

16 years old

answer

to be officially counted as unemployed AAperson must be at least what age

question

LABOR FORCE PARTICIPATION RATE

answer

includes both employed workers and those unemployed but seeking employment

question

UNEMPLOYMENT RATE example: The population is 1,200 million, the labor force is 150 million, and the number of unemployed is 15 million. What is the unemployment rate?

answer

10% (# of unemployed / labor force) (15 million / 150 million)

question

Not in the labor foce

answer

a person who has to quit his job to take care of his children full time is

question

stock; number of people at a point in time who are not working but looking for work

answer

Unemployment is a ___________ concept, measuring the _______

question

Stock Concept

answer

unemployment is a

question

FLOW MEASURES

answer

# of people who lost their jobs and # of people who found jobs

question

STOCK MEASURES

answer

total # in the labor force and total # unemployed

question

LABOR FORCE example: Suppose the population of Millerville is 100,000. Of the population 16 years and older, 50,000 are employed, 10,000 have never worked and are not looking for work, 5,000 are not working and are looking for work, and 15,000 are retired and not looking for work. The labor force equals

answer

55,000 (employed + unemployed)

question

UNEMPLOYMENT RATE example: In a small country, the population equals 5,000. There are 4,000 people in the labor force and 3,000 people are employed. The unemployment rate equals

answer

.25 (1,000 / 4,000) divide the number of unemployed by the number of people in the labor force

question

UNEMPLOYMENT RATE example: In a small country, the adult population is 10,000. In that country, 7,000 people are in the labor force and 6,300 people are employed. The unemployment rate equals

answer

10 percent (700 / 7,000) divide the number of unemployed by the number of people in the labor force

question

JOB LOSER

answer

an individual in the labor force whose employment was involuntarily terminated

question

Which are Considered UNEMPLOYED: a- job leavers b- job re-entrants c- new job entrants d- discouraged workers

answer

a- job leavers b- job re-entrants c- new job entrants

question

NEW ENTRANTS

answer

account for around 10% of the unemployed

question

NEW ENTRANT

answer

an individual who has never held a full-time job lasting 2 + weeks but is not seeking employment

question

does not include the number of discouraged workers as unemployed

answer

One criticism of the unemployment rate is that it:

question

people get discouraged (taking them out of the "unemployed but currently looking for work" category) and quit looking for work

answer

The unemployment rate will decrease when:

question

Increasing family size :

answer

NOT a factor that has contributed to the rising female participation rate

question

During the Great Depression:

answer

the U.S. unemployment rate reached its historical highest

question

Total population 745,000 Working age population 550,000 Number employed 361,000 Number of unemployed 19,000

answer

<-- use this information for the following 4 rate questions

question

Using the above table, the EMPLOYMENT RATE is:

answer

95% (361,000 / 380,000) (employed / labor force*) *labor force = employed + unemployed

question

Using the above table, the LABOR FORCE PARTICIPATION RATE is

answer

69.1% (380,000 / 550,000) (labor force* / working age population) *labor force = employed + unemployed

question

Using the above table, the UNEMPLOYMENT RATE Is:

answer

5% (19,000 / 380,000) (unemployed / labor force*) *labor force = employed + unemployed

question

FRICTIONAL UNEMPLOYMENT

answer

will always exist since some workers will always ant to make a job transition

question

you are considered FRICTIONALLY UNEMPLOYED if

answer

you quit a job in order to look for more rewarding employment

question

you are considered STRUCTURALLY UNEMPLOYED if

answer

your abilities and skill set are a poor match with current requirements of employers

question

you are considered FRICTIONALLY UNEMPLOYED if

answer

you are fired for poor performance but possess skills required to obtain another job after some searching

question

you are considered STRUCTURALLY UNEMPLOYED if

answer

your job has been replaced by robots and you lack ability and skills required to attain other jobs

question

you are considered STRUCTURALLY UNEMPLOYED if

answer

you lose your job due to changing locations of operations (i.e. out of the country)

question

you are considered FRICTIONALLY UNEMPLOYED if

answer

you recently graduated with a degree and are in search for a place to begin your new career

question

When an individual is FRICTIONALLY UNEMPLOYED, the unemployment arises from:

answer

imperfect labor market information which requires individuals to search for appropriate employment

question

CYCLICAL UNEMPLOYMENT occurs when:

answer

a downturn in economic activity decreases employment

question

you are considered CYCLICALLY UNEMPLOYED if

answer

you lose your job as a real estate salesperson when the housing market went soft

question

STRUCTURAL UNEMPLOYMENT results when:

answer

the introduction of a product substitute leads to a large decline in the market demand for a product so that workers specializing in the production of that product find themselves out of work.

question

FRICTIONAL UNEMPLOYMENT exists because

answer

there are costs associated with searching for jobs

question

CYCLICAL UNEMPLOYMENT

answer

is caused by business recessions

question

FRICTIONAL UNEMPLOYMENT

answer

a person quits her job in order to spend time looking for a better paying job

question

STRUCTURAL UNEMPLOYMENT

answer

results from a mismatch of workers' abilities and skills with current requirements of employers

question

SEASONAL UNEMPLOYMENT

answer

is a result of the seasonal pattern of work in specific industries

question

SEASONALLY ADJUSTED UNEMPLOYMENT RATE

answer

removes the seasonal variation from the unemployment rate

question

SEASONALLY ADJUSTED UNEMPLOYMENT RATE

answer

sum of the frictional unemployment rate, structural unemployment rate, and cyclical unemployment rate

question

you are in FRICTIONAL UNEMPLOYMENT when

answer

you graduate from college, and start to look for a job

question

the NATURAL RATE OF UNEMPLOYMENT

answer

cyclical unemployment is not included in this

question

some portion of the labor force will always be between jobs

answer

an unemployment rate of ZERO cannot be expected since

question

FULL EMPLOYMENT means:

answer

taking seasonal fluctuations into account, only frictional and structural unemployment exist

question

the NATURAL RATE OF UNEMPLOYMENT in the U.S.

answer

5 percent

question

FULL EMPLOYMENT

answer

the unemployment level when the normal friction in the economy is taken in account

question

the NATURAL RATE OF UNEMPLOYMENT

answer

the long-run average rate of unemployment due to frictional and structural causes

question

FULL EMPLOYMENT in the U.S. today

answer

about 95% employment rate

question

The level of unemployment that is = to the frictional and structural rate in the long run

answer

The natural rate of unemployment

question

INFLATION and DEFLATION concept

answer

their dependence on average rather than individual prices

question

DEFLATION

answer

a sustained decrease in the average of all prices of goods and services in the economy

question

Producer price index (PPI)

answer

the statistical measure of a weighted average of prices of goods and services that firms produce and sell

question

INFLATION

answer

the average of all prices are on a sustained rise over a period of time

question

DEFLATION

answer

the average of all prices of goods and services in an economy is falling

question

the rate of inflation and the purchasing power of money

answer

are inversely related

question

when inflation occurs

answer

the purchasing power of money always drops

question

NOMINAL VALUE

answer

the price of the good in today's dollars

question

BASIC PRICE INDEX formula

answer

(cost of market basket today / cost of market basket in base year) X 100

question

PRICE INDEX example: If the current price of a market basket of goods is $850 and the base year price for the same market basket is $500, what is the value of the price index?

answer

170 (850 / 500) x 100

question

PRICE INDEX example: Assume that the current price of a market basket of goods is $2,500 and the base year price of the same market basket is $1,340. The price index is:

answer

186.6 (2,500 / 1,340) x 100

question

CONSUMER PRICE INDEX

answer

measures the level of prices with respect to goods and services purchased by a typical consumer in urban areas

question

PRICE INDEX

answer

the cost of today's goods expressed in terms of the cost of goods in a base year

question

CONSUMER PRICE INDEX

answer

statistical measure of the weighted average of prices of goods purchased by a typical individual

question

Gross Domestic Product (GDP) DEFLATOR

answer

the broadest indication of economy-wide inflation

question

PRODUCER PRICE INDEX

answer

gives the earliest warning of increasing inflation

question

PRICE INDEX

answer

the quantities in the market basket stay the same while the prices differ in computing a _______ _________

question

GROSS DOMESTIC PRODUCT (GDP) DEFATOR

answer

a price index that measures the changes in prices of ALL goods and services produced by the economy

question

CONSUMER PRICE INDEX (CPI)

answer

a measure of INFLATION for a typical consumer of the market basket used to calculate the index

question

Relationship between the PRODUCER PRICE INDEX (PPI) and the CONSUMER PRICE INDEX (CPI)

answer

The PPI usually increases before the CPI

question

when there is DEFLATION

answer

the purchasing power of money increases

question

the REAL VALUE

answer

the value of an item expressed in purchasing power that varies with the overall price level

question

NOMINAL VALUE

answer

the value of an item expressed in today's dollars

question

for the CPI the value of the index in the base year

answer

always equals 100

question

the inflation rate

answer

the __________________ rate has been highest during periods of war

question

THE BUREAU OF LABOR STATISTICS

answer

this government agency compiles the consumer price index (CPI)

question

the GDP deflator

answer

the broadest price index reported in the United States

question

the GDP deflator

answer

reflects not only changes in prices, but also changes in consumption patterns as consumers substitute between goods

question

an EXTERNAL SHOCK

answer

a war in the Middle East that disrupts U.S. economic activity is known as

question

an EXPANSION

answer

a business fluctuation when the pace of business activity is speeding up is known as

question

The National Bureau of Economic Research

answer

a nonprofit organization that evaluates the business cycles

question

RECESSION

answer

incomes fall, and unemployment rises during a

question

CONTRACTION

answer

A business fluctuation when the pace of economic activity is slowing down is called a

question

World War II

answer

According to business activity charts for the last 100 years, the point of the highest business activity in the United States occurred during

question

DEPRESSION

answer

a severe and prolonged recession is called a

question

CYCLICAL EMPLOYMENT

answer

When the economy is experiencing a contraction, there is an increase in

question

REAL

answer

the ____ interest rate is the nominal interest rate minus the anticipated inflation rate

question

a COLA

answer

A clause in a contract that automatically increases wages to account for increases in the price level is

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