Question

1. The unemployment rate measures:

A. The percentage of working age adults who are unemployed.

B. The percentage of working age adults who are unemployed but not looking for work.

C. The percentage of working age adults who are employed.

D. The percentage of the labor force who do not have a job, but are looking for one.

2. What does the US unemployment rate range normally return to as the long-run average?

A. Somewhere between 5% and 7%.

B. Somewhere between 2% and 4%.

C. Somewhere between 4% and 6%.

3. Why are cross-country comparisons of unemployment rates difficult?

A. There is a unified definition of ‘unemployment’ between countries.

B. There is higher government employment in developed countries.

C. There are non-traditional labor markets (i.e. barter, subsistence agriculture) in many developing countries.

Answer 1

1) D. The percentage of the labor force who do not have a job, but are looking for one.

The unemployment rate helps to measures the share of workers who are in the labor force and those who do not have a job and are actively searching for a job.

2) C. Somewhere between 4% and 6%.

3) C. There are non-traditional labor markets( i.e.barter,subsidence agriculture) in many developing countries.

this is because of the cultural values that affect the employment trends in a different manner.