Author Question: In the U.S., over the past forty years, A) exports as a percentage of GDP have increased, while ... (Read 65 times)

swpotter12 · **on:** Jun 30, 2018

In the U.S., over the past forty years,

A) exports as a percentage of GDP have increased, while imports has a percentage of GDP have decreased.
B) exports as a percentage of GDP have decreased, while imports has a percentage of GDP have increased.
C) both exports and imports as a percentage of GDP have decreased.
D) both exports and imports as a percentage of GDP have increased.
E) both exports and imports as a percentage of GDP have remained constant.

Question 2

What effect does the existence of discouraged workers have on the ability of the official unemployment rate to provide accurate information about the extent to which labor is employed?

What will be an ideal response?

jamesnevil303 · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

D

Answer to Question 2

Discouraged workers are individuals who have stopped searching for employment because, for example, they have become discouraged with the prospects of finding employment. Once they stop searching (after 4 weeks), they are no longer counted as unemployed and, therefore, in the labor force. Such a dynamic would cause the official unemployment to fall. Alternatively, the existence of discouraged workers implies that the official unemployment rate underestimates the extent to which labor is being is not being used. This explains why the existence of discouraged workers can cause the unemployment rate to be an imperfect measure of the utilization of labor.