Labor Economics Exam Questions Answered Correctly Latest Update 2024 (Graded A+)
N.A.I.R.U stands for what? - Answers Non-accelerated rate of unemployment
NAIRU definition - Answers A measure that represents full employment and stable inflation.
Full employment - Answers A state in our economy where additional demand does not create jobs.
The NAIRU is projected by what government agency? - Answers The CBO
CBO NAIRU - Answers Represents the industry's standard for the unemployment with full employment
Unemployment - Answers The average of the jobless rates across the nation weighted against the
relative size of the local workforce.
Unemployment < NAIRU - Answers This means that the labor market is tight.
What happens when labor markets are tight? - Answers Tight labor markets increases the income of all
Americans regardless of class. But majority of the benefits disproportionally goes to the lower and
middle class of Americans.
In what areas does the lower, middle, and upper class see a percentage increase in? And who gets the
bigger increase? - Answers The American Working Class can expect to see a percentage increase in
wages, hours and evidently income.
The lower and middle class of America will see the biggest percentage increase in income that the upper
class of America.
True or False:
The increase in income that the upper class will see during tight labor markets would be so small that
statistically it would be insignificant - Answers True
What are the three types of unemployment? - Answers 1) Structural
2) Cyclical
3) Frictional
What is structural unemployment? - Answers Unemployment created due to the fact that the suppliers
lack the skill or ability to obtain a job.
In a full economy structural unemployment represents what? - Answers The floor in our pursuit to full
employment.
Can an increase in demand decrease structural employment? - Answers No
N.A.I.R.U stands for what? - Answers Non-accelerated rate of unemployment
NAIRU definition - Answers A measure that represents full employment and stable inflation.
Full employment - Answers A state in our economy where additional demand does not create jobs.
The NAIRU is projected by what government agency? - Answers The CBO
CBO NAIRU - Answers Represents the industry's standard for the unemployment with full employment
Unemployment - Answers The average of the jobless rates across the nation weighted against the
relative size of the local workforce.
Unemployment < NAIRU - Answers This means that the labor market is tight.
What happens when labor markets are tight? - Answers Tight labor markets increases the income of all
Americans regardless of class. But majority of the benefits disproportionally goes to the lower and
middle class of Americans.
In what areas does the lower, middle, and upper class see a percentage increase in? And who gets the
bigger increase? - Answers The American Working Class can expect to see a percentage increase in
wages, hours and evidently income.
The lower and middle class of America will see the biggest percentage increase in income that the upper
class of America.
True or False:
The increase in income that the upper class will see during tight labor markets would be so small that
statistically it would be insignificant - Answers True
What are the three types of unemployment? - Answers 1) Structural
2) Cyclical
3) Frictional
What is structural unemployment? - Answers Unemployment created due to the fact that the suppliers
lack the skill or ability to obtain a job.
In a full economy structural unemployment represents what? - Answers The floor in our pursuit to full
employment.
Can an increase in demand decrease structural employment? - Answers No
