2.2 Unemployment

• Frictional unemployment is caused by technological changes in the economy.

  False
• Order the types of unemployment from most temporary to most cyclical:

  1️⃣ Frictional

  2️⃣ Structural

  3️⃣ Cyclical
• Cyclical unemployment increases during economic expansions.

  False
• Cyclical unemployment is influenced by changes in aggregate demand.


  True
• Which government agency calculates the unemployment rate in the United States?

  Bureau of Labor Statistics
• What is the economic impact of structural unemployment?

  Reduced productivity
• Structural unemployment indicates a fundamental mismatch between worker skills and job requirements
• The overall unemployment rate is influenced by factors such as economic growth and labor market policies
• What type of unemployment is considered a natural and temporary part of the labor market?

  Frictional
• Structural unemployment arises from fundamental changes in the economy
• The labor force includes all individuals who are employed or unemployed but actively seeking work
• Frictional unemployment has a relatively minor and temporary economic impact
• What type of unemployment reflects normal labor market turnover and is relatively minor and temporary?

  Frictional unemployment
• What does the term "unemployment" refer to?

  Being without a job
• Match the type of unemployment with its cause:

  Frictional ↔️ Normal labor market turnover

  Structural ↔️ Technological changes

  Cyclical ↔️ Fluctuations in aggregate demand
• Cyclical unemployment increases during recessions due to a decrease in aggregate demand.


  True
• Governments can invest in retraining programs to address structural unemployment.
• Structural unemployment is caused by technological changes or shifts in the economy
• What is an example of structural unemployment?

  Unemployed coal miners
• What does the unemployment rate measure?

  Percentage of unemployed workers
• The labor force includes all individuals who are employed or unemployed but actively seeking work.

  True
• Policies that promote labor market flexibility can help reduce frictional unemployment.


  True
• Unemployment refers to the state of being without a job while actively seeking employment
• What is the cause of cyclical unemployment?

  Fluctuations in aggregate demand
• Match the type of unemployment with its cause:

  Frictional ↔️ Normal turnover in the labor market

  Structural ↔️ Technological changes

  Cyclical ↔️ Business cycle fluctuations
• What is the primary cause of structural unemployment?

  Mismatch between worker skills and job requirements
• What is the formula for calculating the unemployment rate?

  $\frac{\text{Number of Unemployed}}{\text{Labor Force}} \times 100$
• Individuals who are retired are included in the labor force.

  False
• Cyclical unemployment can lead to reduced income and spending during recessions.

  True
• Cyclical unemployment is tied to fluctuations in aggregate demand and can lead to reduced output during recessions.


  True
• Cyclical unemployment rises during economic expansions and falls during recessions.

  False
• Structural unemployment arises from fundamental changes in the economy
• The unemployment rate is calculated by dividing the number of unemployed by the labor force and multiplying by 100.
• What type of government policy is used to address cyclical unemployment?

  Expansionary fiscal policy