Macro FTC1 Unit 3 Study Guide- Introduction to Macroeconomics Western Governors University

Unit 3: Introduction to Macroeconomics Module 4: Unemployment, Inflation, and Economic Fluctuations Figure 4.1: U.S. unemployment rates (percentage of the civilian labor force), 1950– 2012 1. “Fill in the blank" question: Full employment embodies the highest amount of skilled and unskilled labor that could be employed within an economy at any given time. Correct. Full employment is attainable within any economy, but may result in an inflationary period. 2. “Fill in the blank" question: The help wanted index is an indicator of strength or weakness in the national labor markets, by providing information on how many positions need to be filled. Correct. When the help wanted index is rising, it means there is a relatively large amount of positions needing to be filled. 3. True or false. When there is full employment, the number of job seekers is approximately equal to the number of job vacancies. Correct. When there is full employment, the number of job seekers is approximately equal to the number of job vacancies. 4. True or false. Full employment means that everyone in the population is employed. Correct. Full employment assumes that some level of unemployment is normal (acceptable or desirable) and is only concerned about unemployment in excess of that amount. *Frictional and Structural Unemployment *Cyclical Unemployment