The chief economic cost of unemployment is
a. the value of the leisure that is lost when people are unemployed
b. the cost to employed citizens of paying unemployment benefits
c. money spent on the job search process
d. the chance that the unemployed might turn to crime to support themselves
e. the value of output that could have been produced, but is not
E
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Moral hazard and adverse selection are the result of ________
A) prudential supervision B) any and all government policy C) excessive price fluctuations D) asymmetries of information
Which of the following is an example of cyclical unemployment?
a. A recent college graduate still looking for her first job b. A car salesman who loses his job because of a recession c. A ski instructor who is out of work during the summer d. An economics journalist who just quit her writing job in order to begin a new career as a college professor next month e. A worker displaced from his factory job because of greater mechanization in the workplace
A situation in which output decreases while prices increase is often referred to as:
A. inflation. B. negative economic growth. C. a recession. D. stagflation.
Answer the following statement true (T) or false (F)
1) An increase in demand accompanied by an increase in supply will increase the equilibrium quantity, but the effect on equilibrium price will be indeterminate. 2) A government subsidy per unit of output increases supply. 3) Consumers buy more of normal goods as their incomes rise. 4) Toothpaste and toothbrushes are substitute goods.