Question

QUESTION 45

1. If the labor market flow P_ue is found to equal 0.2 for a particular month, this means that

   		20 percent of the total adult population flowed from unemployment to employment during the month.
   		20 percent of the total labor force flowed from unemployment to employment during the month.
   		20 percent of those who were initially unemployed became employed during the month.
   		20 percent of those who were initially employed became unemployed during the month

2 points   

QUESTION 46

1. Recent estimates suggest that every 1 percentage point decrease in the unemployment rate raises national output by

   		2 percentage points.
   		3 percentage points.
   		5 percentage points.
   		10 percentage points.

2 points   

QUESTION 47

1. More generous unemployment compensation ________ unemployment spells

   		lengthens
   		shortens
   		has no effect on the length of
   		first decreases, then increases

2 points   

QUESTION 48

1. Workers performing dangerous jobs in the economy are typically people that

   		cannot find work offering better conditions.
   		see the jobs as paying well compared to alternative employment.
   		are poorly paid.
   		enjoy danger.

Answer 1

Answer-45. Correct option is 'A'

If the labor market flow P_ue is found to equal 0.2 for a particular month, this means that 20 percent of the total adult population flowed from unemployment to employment during the month this means that 20 percent of the total labor force flowed from unemployment to employment during the month.

Answer-46. Correct option is 'B'

Recent estimates suggest that every 1 percentage point decrease in the unemployment rate raises national output by 3 percentage points. Okun's law has stated very simple that when employment falls by 1 %, gross national product (GNP) or national output rises by 3%.

Answer-47. Correct option is 'A'

More generous unemployment compensation lengthens unemployment spells.The search theory suggests that generous compensation makes the unemployed less inclined to search for jobs and and more selective before accepting job offer. According to this theory the behaviour by the unemployed will lengthens the unemployment spell.

Answer-48. Correct option is 'B'

Workers performing dangerous jobs in the economy are typically people that see the jobs as paying well compared to alternative employment.