The unemployment rate tends toO A. generally rise during recessions.O B. fluctuate independent of the business cycle.OC. generally fall during expansions.O D. A and B.O E. none of the above.

Answer Unemployment tends to rise quickly and sometimes stays elevated throughout a recession. With…

Answered: generally rise during recessions.

Business

Economics

generally rise during recessions.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter21: Unemployment

Section: Chapter Questions

Problem 41CTQ: Unemployment rates have been higher in many European countries in recent decades than in the United...

See similar textbooks

Related questions

Q: Questio When is a country said to move into a recession? a) If actual output falls below the…

A: A recession is classified as a significant reduction in overall economic activity that lasts more…

Q: During recessions investment Answer falls by a larger percentage than GDP. falls by about the same…

A: Recession refers to the situation of lower economic activity. All the economic activities will…

Q: The lowest part of a recession is referred to as its _________. a. Depression b. Boom c. Trough d.…

A: The state of economy when there is significant decline in the activities of the nation is referred…

Q: Criticize Keynes in two points on the equality between savings and investment.

A: The Keynesian model assumes that in the short run the prices of the goods are constant and the…

Q: If firms are less optimistic that future profits will rise and remain strong for the next few years,…

A: Answer to the question is as follows :

Q: conomists defined economic recession as more than 2 consecutive quarters in which there is a decline…

A: Economic recession is referred to the fall or decline in the GDP in the comparison of last year,…

Q: After a recession, _____. Select the correct answer below: the economy's internal structure…

A: As a macroeconomic term, "recession" refers to a significant reduction in the region's overall…

Q: Investment is purely financial and has no impact on the level of employment in an economy. a.…

A: The economies around the world tend to focus on their growth, and development through various…

Q: An economic recession means that _______. a. GDP is critically high b. Output and employment is down…

A: An Economic Recession is defined as where there is a decline in the performance of a country and…

Q: When an economy goes into a recession (a decline in GDP) government savings usually Select one: a.…

A: Reccession means slowing down of business and economic activities in the economy. This means less…

Q: All of the following are causes of Great Recession except Group of answer choices Increased…

A: The Great Recession was a period of substantial general deterioration, i.e., a recession,…

Q: Describe two ways economists try to forecast developments in the economy

A: The economies around the world tend to work with the motive of enhancing their economic, and…

Q: Consumption spending is more volatile than investment spending, because consumption spending…

A: Note: In the BNED Guidance, only the first question can be answered at a time. Resend the question…

Q: In what year and quarter did U.S. real GDP first exceed its pre-recession level?

A: The great recession in the U.S. was a combination of financial crisis with deep recession. The great…

Q: In a two sector economy, aggregate demand is a function of _________ and __________

A: The concept of two sector Economy, pays attention to mainly two components of the society which are…

Q: Explain and illustrate graphically recessionary and inflationary gaps.

A: The aggregate demand curve(AD) shows a different combination of quantity of real GDP demanded and…

Q: According to the textbook definition, a recession occurs if ___ GDP decreases for ____ Question…

A: If nominal GDP decreases for consecutive 2 quarters,then recession occurs.

Q: », and is then hit by a sharp increase in

Q: Recessions can be caused by a) a decrease in Aggregate Demand ONLY b) an increase in Aggregate…

A: Recession: It means a contraction in a business cycle when an economy decline generally.

Q: The phase of the business cycle in which real GDP declines is called: a recovery. the trough. a…

A: Business cycle: Also known as economic cycle or trade cycle, business cycle are the fluctuation in…

Q: Compare and contrast the effect of expansion and recession on selected variables like output and…

A: Let us understand some key terms such as - Business cycle aggregate demand, aggregate supply,…

Q: Suppose from one year to the next, the GDP deflator increased by 3% and nominal GDP increased by 1%.…

A: GDP Deflator helps to change in prices of all goods produced; only includes goods produced…

Q: Producers will change their prices when GDP is at the equilibrium level. True or False

A: Gross Domestic Product is the sum total amount of goods and services produced in the economy at a…

Q: When actual GDP does not rise as fast as potential GDP, the economy most likely will experience…

A: The answer to the question is as follows :

Q: Suppose most business executives expect a slowdown in the economy. How might this situation affect…

A: The loss of business and consumer confidence leads to an economic recession.

Q: Officially recession is defined as: decrease in the real GDP for two consecutive quarters. decrease…

Q: Can we attain equilibrium GDP on the demand side and still have high unemployment?

Q: Suppose real GDP exceeds potential real GDP. If the government decreases its expenditures on goods…

A: GDP is the sum of the value of all the goods and services produced within the geographical borders…

Q: Which kind of economic measures do you recommend at the current economic situation which is…

A: A stagflation situation is characterized by a high inflation rate and low economic growth. This…

Q: Y = C + S even when the economy is not in equilibrium. True Or False

A: In an economy, saving is the part of income which is not spent on consumption expenditure, and so Y…

Q: According to Keynes, nominal wage increases mostly and directly lead to a inflationary development a…

A: Inflation: - Inflation is the phenomenon of an increase in the prices of goods and services in an…

Q: You are shown the statements below. Which of the following is/are true? Statement 1: During a…

A: Meaning of Business Cycle: The term business cycle refers to the measurement of whether an economy…

Q: Define recession.

A: Recession is one of the phase of the business cycle.

Q: Why did Keynes believe that the proper response to a period of recession was for the government to…

A: Keynes' macroeconomic view is referred to as the most practical view in economics as it deals with…

Q: Do you think there is a predictable relationship between the business cycle and aggregate investment…

A: The fluctuation in the economic activity is tracked by the business cycle. In an economy, the fall…

Q: Inflationary GDP is the amount by which equilibrium real GDP falls short of the full employment…

A: Inflationary gap is said to exists when the aggregate expenditure exceeds the full employment real…

Q: Which of the following is a Keynesian approach for dealing with a recession? a) Raise interest…

A: The Keynesian approach to dealing with a recession is expansionary fiscal policy. Expansionary…

Q: Assume that an economy currently experiences an decrease in both employment and real GDP. The…

A: The Gross Domestic Product is the summation of the money value of all the final goods and services…

Q: What policy changes would Keynes recommend to counteract a recession?

A: There are various schools of economic thought. Each school has its own beliefs and principles. The…

Q: "In the classical model, the equilibrium level of real Gross Domestic Product (GDP) is completely…

A: Classical Model, the economy is always at full employment and wages and prices are flexible. It…

Q: Explain business response towards recessionary pressures in the economy.

A: Recessionary pressures occur when there are signs that the economy is slowing down. When inflation…

Q: What is the best formula to measure recessionary gap?

A: The long-run macroeconomic equilibrium in an economy is determined by the aggregate demand and…

Q: If Full employment GDP is greater than equilibrium GDP, the economy is facing A) Recession B)…

A: Full employment GDP = Potential GDP. This denotes the long run potential production level of an…

Question

The unemployment rate tends to
O A. generally rise during recessions.
O B. fluctuate independent of the business cycle.
OC. generally fall during expansions.
O D. A and B.
O E. none of the above.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1g

VIEW

Step 2

VIEW

Step 3

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

QUESTION 5Which of the following best describes inflation?O a. Economic growth.O b. An increase only in the price of energy.O c. An increase in the overall price level in an economy.O d. Ballooning debt.
Unemployment rates have been higher in many European countries in recent decades than in the United States. Is the main reason for this long-term difference in unemployment rates more likely to be cyclical unemployment or the natural rate of unemployment? Explain briefly.
Q1) Individuals are counted as unemployed if they have Select one: O a. no job O b. no job and are not looking. O c. no job but looked for a job at least once in the last four weeks. O d. no job but looked for a job at least once in the last six months. Q2) Which of the following is not a topic studied in Macroeconomics Select one: O a. Unemployment O b. Gross Domestic Products (GDP) O c. None of the options O d. Inflation
Based on Okun's rule of thumb, if you forecast that the output gap will decline from -1% to -3%, the unemployment rate will: O rise by 0.5%. rise by 2%. O rise by 1%. fall by 1%.
A positive oil shock: Suppose scientists discover a new way to extract oil fromdeposits that were previously thought to be unrecoverable. Te extra supply ofoil leads oil prices to decline by $5 per barrel. Explain the efect on wages, theemployment-population ratio, and unemployment—all for the overall economy.
Two main macroeconomic concerns are the problems of inflation andunemployment.a. What are the social costs of inflation? Explain TWO of them? b. What is natural rate of unemployment? Explain the TWO main causesof natural rate of unemployment. With reference specifically to ONEof these causes, suggest ONE practical government policy that reducesthe natural rate of unemployment.
How would an increase in the world price of oil affect the amount oI fricnal unemployment? Is this unemployment undesirable? What publicpolicies mighIt affect the amoufll of unemployment caused by this price change?
A proposal that is attracting increasing attention is a requirement that employers provide theirworkers with paid sick leave. This problem asks you to analyze the effects of such a policy on wages andemployment in normal times.a. How, if at all, would such a policy affect labor demand? (explain using MRP)b. How, if at all, would it affect labor supply? (explain using willingness to work)c. How, if at all, would the policy affect normal employment and the normal real wage (or is itnot possible to tell)? include graphs
A.) Okun's law is stated as... Change in the Unemployment Rate = -0.2*(Percent Change in Real GDP - 2.5) ... Then what is the expected annual growth rate of GDP? B.)Change in the Unemployment Rate = -0.2*(Percent Change in Real GDP - 2.5) ... If the percent change in GDP is 3%, and the unemployment rate starts at 5%, what is the change in the unemployment rate?
A. Employment at will tends to raise the unemployment rate O. True O. False B. The minimum wage lowers the price of labor from the market wage to the minimum wage, and as labor becomes less expensive, firms increase employment from market employment to minimum wage employment O. True O. False
Suppose that a country experiences a reduction in productivity--that is, an adverse shock to the production function. (This example should sound familiar!)a. What happens to the labor demand curve?b. How would this change in productivity affect the labor market--that is, employment, unemployment, and real wages--if the labor market was always in equilibrium?c. How would this change in productivity affect the labor market if unions prevented real wages from falling?
If the unemployment rate is 6% before a rise in government purchases, and if a rise in government purchases induces the typicalunemployed person to search 10% longer in the hopes of finding ahigh-paying government job, what will the unemployment rate beafter the rise in government purchases? Only consider the impactof this waiting-for-a-good-job effect.