Chapter 21: Q. 33 (page 525)
Would you expect hidden unemployment to be higher, lower, or about the same when the unemployment rate is high, say , versus low, say ? Explain.
If the unemployment rate increases, then hidden unemployment will rise.
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Is the increase in labor force participation rates among women better thought of as causing an increase in cyclical unemployment or an increase in the natural rate of unemployment? Why?
What happens to the unemployment rate when unemployed workers are reclassified as discouraged workers?
The U.S. unemployment rate increased from 4.6%
in July 2001 to 5.9% by June 2002. Without studying the subject in any detail, would you expect that a change of this kind is more likely to be due to cyclical unemployment or a change in the natural rate of unemployment? Why?
Suppose the adult population over the age of 16 is 237.8 million and the labor force is 153.9 million (of whom 139.1 million are employed). How many people are “not in the labor force?” What are the proportions of employed, unemployed and not in the labor force in the population? Hint: Proportions are percentages.
Is the higher unemployment rates for minority workers necessarily an indication of discrimination? What could be some other reasons for the higher unemployment rate?
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