The existence of discouraged workers:
a. increases the size of the labor force, but does not affect the unemployment rate
b. affects neither the size of the labor force nor the unemployment rate.
c. may cause the official unemployment rate to understate the true amount of unemployment.
d. may cause the official unemployment rate to overstate the true amount of unemployment.
c
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If firms successfully gather information about consumers before offering them insurance, and if this leads to a separating equilibrium, efficiency is restored.
Answer the following statement true (T) or false (F)
We can be more confident that standard deviation is a good measure of the risk of an asset (held in isolation) when
A) the number of different possible returns on the asset rises. B) the probabilities attached to the possible returns on the asset are less equal. C) the possible returns on the asset are distributed symmetrically around the mean. D) the asset has a longer maturity.
Human capital is
a. the same thing as technological knowledge. b. the same thing as labor. c. the tools and equipment operated by humans. d. knowledge and skills that workers have acquired.
If a central bank reduced inflation by 2 percentage points and that made output fall by 3 percentage points for 2 years and the unemployment rate rise from 3 percent to 5 percent for 2 years, the sacrifice ratio is
a. 1. b. 2. c. 3. d. None of the above is correct.