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Macro Ch. 9
Terms in this set (21)
Unemployment Rate Equation
number of unemployed/labor force x 100
What is NOT one of the conditions someone needs to meet to be counted as unemployed?
They had worked only one hour per week during the previous four weeks.
The labor force participation rate is calculated by...
labor force/working-age population times 100
employment population ratio
the percentage of the working-age population that is employed
When an unemployed person drops out of the labor force, the unemployment rate...
understates the true degree of joblessness in the economy
When an unemployed person drops out of the labor force, it...
does NOT affect the employment-population ratio.
labor force participation rate
the percentage of the working-age population in the labor force
Unemployment rates are
lower for college graduates than for people without a high school degree, and vary greatly among ethnic
What formula does the Bureau of Labor Statistics use to calculate the unemployment rate?
number of unemployed/number in the labor force times 100
Three types of unemployment
frictional, structural, cyclical
The type of unemployment most likely to result in hardship for the people who are unemployed is
structural because this type of unemployment requires retraining to acquire new job skills
When the economy is at full employment, unemployment is equal to
the natural rate of unemployment
What happens when the economy is at full employment?
-all remaining unemployment is either frictional or structural
-the natural rate of unemployment prevails
-the unemployment rate is greater than zero
unemployment caused by a recession
As output (GDP) is increasing, what would happen to the amount of cyclical unemployment
It would decrease
What happens to the unemployment rate during recessions?
What happens to the unemployment rate during expansions?
The unemployment rate is always above...
short-term unemployment that arises from the process of matching workers with jobs
unemployment that occurs when workers' skills do not match the jobs that are available
What index is used to measure the average prices paid by a typical family?
consumer price index (CPI)
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