Question

1) Ed is on a temporary winter layoff from the canal system where he works as a lock master. If Ed participates in the Statistics Canada survey, how will he be classified?

A	as employed and out of the labour force
B	as unemployed and in the labour force
C	as unemployed and out of the labour force
D	as employed and in the labour force

2) How is Rachel, a stay-at-home parent who works as a volunteer at the local Canadian Cancer Society office and is currently not looking for a job, counted?

A	as unemployed and not in the labour force
B	as unemployed and in the labour force
C	as employed and in the labour force
D	as not in the labour force

3) Mary Ellen is the newly appointed CEO of a company that packages cereal on an assembly line. Her staff has told her that the output the firm produces, given the number of workers employed, indicates that some workers may be shirking. According to efficiency wage theory, what should she do?

A	make sure that workers are getting paid exactly the equilibrium wage rate
B	pay all workers more than the equilibrium wage rate
C	reduce production
D	pay all workers below the equilibrium wage rate to make up for the loss from shirking

4) Regarding the categories of unemployment, how does a minimum-wage law compare to firms paying higher-than-equilibrium wages?

A	The minimum wage and firms paying wages above equilibrium both create frictional unemployment.
B	The minimum wage creates frictional unemployment, while firms paying wages above equilibrium create structural unemployment.
C	The minimum wage creates structural unemployment, while firms paying wages above equilibrium create frictional unemployment.
D	The minimum wage and firms paying wages above equilibrium both create structural unemployment.

Answer 1

1. Option d is correct. Ed is on a temporary winter lay off from canal system where he works as a lock master. If Ed participates in the Statistic Canada Survey , he is considered as employed and in the labor force. Temporary works and part - time jobs are considered as employment. He is already in labour force. All other options are wrong. Because he is considered as employed and part of labor force 2. Option a is correct. Rachel , a stay at home parent who works as a volunteer at the local Canadian Cancer society office and currently is not looking for job counted. Then he is considered as unemployed and not in labor force. Volunteers are defined as persons did unpaid work for an organisation. Volunteering is not apart of labor force. All other options are wrong. Because volunteering is not an employment 3.Option c is correct. Marry Ellen is the newly appointed CEO of a company that packages cereal on an assembly line. Her staff has told her that the output the firm produces, given the number of workers employed, indicates the some workers may be shirking. According to efficiency wage theory ,she should pay all workers more than equilibrium wage rate. Then she can avoid the shirking of her workers. All the other options are wrong. By proving wage rate than equilibrium wage rate , she can avoid the shirking of workers 4.Option d is correct. Minimum wage and firms paying wages above equilibrium both create structural unemployment. Because at minimum wage and wages higher than equilibrium wage rate, demand for skilled labors will be higher and demand for unskilled labors will be decline.. All other options are wrong . Because it causes structural unemployment