Being unemployed in economic terms means that you are:
a. out of work and actively looking for a job.
b. out of paid work and not actively looking for a job.
c. out of work and not actively looking for a job.
d. out of paid work and unable to work.
a. out of work and actively looking for a job.
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Long-term contracts are desirable for both firms and workers for each of the following reasons EXCEPT one. Which of the following does NOT explain the desirability of long-term contracts?
A) Wage negotiations are costly and time consuming on both sides. B) Contracts insulate workers from changing economic conditions such as decreases in aggregate demand. C) The incidence of strikes decreases because the contracts are binding for three years. D) Contracts reduce uncertainty.
Refer to the above figure. Suppose the natural rate of unemployment is 5 percent. If the government tried to reduce unemployment to 4 percent and keep it there, it must
A) raise unemployment benefits. B) accept a permanent inflation rate of 1 percent. C) generate higher and higher inflation rates or else people will adjust their behavior and the unemployment rate will return to 5 percent. D) use contractionary fiscal and expansionary monetary policy.
If the price of a product falls below average total cost in the short run, the firm
a. has an economic profit b. cannot cover total fixed costs c. experiences a loss d. must always shut down e. should expand output until MC = MR
The name given to government programs implemented to prevent or shorten recessions and counteract inflation is
a. supply-side economics. b. contractionary policy. c. monetary policy. d. stabilization policy.