What is job search and what is the relationship between job search and unemployment? What factors can affect the amount of job search? Briefly discuss the effect of each factor
What will be an ideal response?
Job search is the activity of looking for a suitable job. Unemployed workers are searching for a job, and so the longer these workers search, the greater the amount of unemployment. Three major factors affect the amount of job search: demographic change, unemployment benefits, and structural change. Demographic change refers to the fact that at times there are more young people looking for their first jobs and at other times there are fewer young people searching for a job. When more young people are searching, the unemployment rate rises and when fewer young people are searching, the unemployment rate falls. Unemployment benefits affect the amount of job search. An increase in unemployment benefits lowers the cost of remaining unemployed and so workers search for longer periods of time. As a result, the unemployment rate rises. Finally, structural change affects the amount of job search. Structural change is the result of technological change. At times, this change creates a slump during which workers from failing industries are not good matches for the jobs created in booming sectors. In this case, the amount of job search and unemployment rises. At other times, the workers released by the slowing sectors have skills that are good matches for the expanding sectors and so the amount of job search and unemployment falls.
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a. The winner's willingness to pay b. The highest willingness to pay among the losers c. The lowest willingness to pay among the losers d. None of the above
The tendency for nominal interest rates to be high when inflation is high and low when inflation is low is known as:
A. deflating. B. shoe leather costs. C. the Fisher effect. D. the consumer price index.
Scarcity can best be defined as a situation in which:
A. there are no buyers willing to purchase what sellers have produced. B. there are not enough goods to satisfy all of the buyers' demand. C. the resources we use to produce goods and services are limited. D. there is more than enough money to satisfy consumers' wants.
The market system communicates changes in market conditions and elicits appropriate responses from businesses and resource suppliers through changes in prices. This is known as the:
A. Guiding function of prices B. Monetary function of prices C. Circular flow of income D. Market determination of prices