Assume that a high proportion of recent college graduates decides to stay in school seeking advanced degrees, rather than confront the challenge of landing a good job in the midst of generally high unemployment
What is the direct impact of this behavior on (a) the labor force participation rate, (b) the employment ratio, and (c) the unemployment rate?
The decision to stay in school makes the labor force smaller than it would be otherwise, so the labor force participation rate is reduced. Fewer employed persons lowers the employment ratio. If all of these individuals would have been counted as unemployed, then the decline in the number of unemployed equals the decrease in the labor force. The percentage decrease in the number of unemployed would then be greater than the percentage decrease in the labor force, so the unemployment rate is reduced. However, to the extent that some of those who stay in school would, otherwise, have found a job, the size of the decline in the unemployment rate is small.
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Which of the following is not an explanation for the revival in the growth of productivity starting in the mid-1990s?
A) Cell phones and wireless Internet access have increased worker flexibility. B) Internet use has increased the efficiency of how firms buy and sell to each other and to consumers. C) Information and communication innovations are increasingly geared toward improving business processes and not consumer products. D) Faster computers have sped up data processing.
When the Fed tightens U.S. monetary policy, domestic interest rates ________, making U.S. assets relatively more attractive to foreign investors, and ________ the equilibrium exchange rate.
A. fall; increasing B. fall; decreasing C. rise; increasing D. rise; decreasing
Use the following information to answer the question below. It is the custom for paper mills located alongside the Layzee River to discharge waste products into the river. As a result, operators of hydroelectric power-generating plants downstream along the river find that they must clean up the river's water before it flows through their equipment. Based on the preceding information, which of the following policies would be most appropriate for dealing with this problem?
A. Levy a tax on the producers of electricity and use the tax revenues to clean up the river. B. Levy a tax on the consumers of paper products and use the tax revenues to conduct research on new energy sources. C. Levy a tax on the consumers of electricity and use the tax revenues to subsidize the consumers of paper products. D. Levy a tax on the producers of paper products and use the tax revenues to clean up the river.
People who benefit from a rent ceiling include
A) all landlords. B) taxpayers. C) tenants who have a rent-controlled apartment. D) potential tenants, that is, people looking for apartments. E) all landlords and some tenants.