Question 1
The measured unemployment rate does not rise as much as one might expect when output decreases because, as the economy contracts
◦ more people enter the labor force.
◦ firms want to hire additional workers.
◦ more people find jobs.
◦ more people leave the labor force.
Question 2
As the economy ________, the labor force increases, and as the economy ________, the labor force decreases.
◦ expands; contracts
◦ contracts; expands
◦ matures; develops
◦ develops; matures