AP Macro Unemployment 3

Question 1

Seasonal unemployment is best described as unemployment that results from:

Accepted Answer

Regular and predictable fluctuations in labor demand across seasons

Answer

Seasonal unemployment arises from predictable, recurring changes in labor demand tied to seasons or holidays.

Question 2

According to most economists, which type of unemployment is included in the natural rate?

Accepted Answer

Frictional and structural unemployment

Answer

The natural rate of unemployment includes frictional and structural unemployment but NOT cyclical unemployment.

Question 3

If Congress passes a law significantly raising the minimum wage above the equilibrium wage, the likely result is:

Accepted Answer

An increase in unemployment due to a labor surplus

Answer

A binding minimum wage above equilibrium creates a surplus of labor (quantity supplied exceeds quantity demanded), raising unemployment.

Question 4

Which of the following would cause the natural rate of unemployment to DECREASE?

Accepted Answer

Improved job-matching technology reducing search time

Answer

Better job-matching technology reduces frictional unemployment, lowering the natural rate.

Question 5

Underemployment differs from unemployment in that underemployed workers are:

Accepted Answer

Working part-time involuntarily or in jobs below their skill level

Answer

Underemployed workers are employed but in positions that do not fully utilize their skills or desired hours.

AP Practice Test