EXAM-STYLE QUESTIONS: MULTIPLE CHOIC

1 What must result from an increase in a country’s unemployment rate?

a decrease in labour mobility
B a decrease in the number of people who are economically inactive
an increase in the number of people unable to find jobs
D an increase in the proportion of the labour force without jobs
2 Lithuania’s unemployment rate fell from 11.7% in 2013 to 6.8% in 2019.
Which diagram illustrates this change?

3 What could explain a country experiencing a rise in the number of employed workers and unemployed workers?
a reduction in the retirement age
a reduction in gender discrimination in labour markets
a rise in net emigration
a rise in the school leaving age
4 Which group of workers would be classified as frictionally unemployed?
A bus drivers losing their jobs as more people switch from bus to car travel
B farm workers being unemployed due to a lack of awareness of job vacancies in the industry
C shop workers made redundant due to the introduction of self-scanning checkouts in supermarkets
D steel workers being made redundant due to a global recession
5 A group of textile workers lose their jobs as a result of a fall in aggregate demand. What type of unemployment are they experiencing?
cyclical
frictional
seasonal
structural
6 Which type of unemployment is caused by imperfect information in the labour market?
cyclical
demand-deficient
frictional
structural
7 Which type of unemployment is caused by the skills and qualifications of the unemployed not matching the requirements of the
jobs on offer?
cyclical
frictional
search
structural
8 What is the opportunity cost of unemployment?
A government spending on training schemes for the unemployed
government spending on unemployment benefits
leisure
output
9 What is a possible benefit of unemployment?
an increase in tax revenue
an increase in workers’ wages
C the opportunity to achieve a better match between workers’ skills and available jobs
D the opportunity to reduce the number of discouraged workers
10 Which change is most likely to cause a decrease in the rate of frictional unemployment?
A a decrease in government spending on unemployment benefits
a decrease in the quality of labour market information
an increase in the rate of income tax
an increase in trade union membership

1. Why is an increase in educational qualifications likely to increase the proportion of women who are economically active?
2. What factors, other than educational qualifications, may influence an adult’s decision on whether to join the labour force?
3. Why may a rise in a country’s output be accompanied by a rise in employment?
4. Will a reduction in the labour force participation rate always have a harmful effect on an economy?
5. If two economic quantities move in the same direction, is it always possible to conclude that one has caused the change in the
other?
6. Why may the unemployment figures of low-income countries, based on a claimant count measure, understate the full extent of
unemployment?
7. Does a decrease in a country’s unemployment rate always indicate that fewer people are without jobs?
8. Why is a labour survey measure likely to record a higher unemployment figure than the claimant count?
9. Why would an increase in geographical labour mobility be likely to increase the difference between unemployment measured by
the claimant count and the labour force survey in China?
10. Why the labour force (ILO) measure is the main one used to make international comparisons.
11. Whether workers who are voluntarily unemployed should be counted as unemployed and how would you assess whether
unemployment is voluntary or involuntary?
12. Did you find it easy to come to agreement on the first question? What difficulties did you encounter in deciding whether
unemployment is voluntary or involuntary?
13. Draw up a list of eight economic concepts that could be used in analysing the causes and consequences of unemployment in a
country.
14. Why the consequences of being unemployed may be more serious in one country than another country?
15. What would a zero rate of unemployment mean?
16. Why might the unemployment rate be low in a country with high incomes?