1. Directions

You will read passages on the topic and then answer questions about them. You may find vocabulary at the end of the test. Read the questions carefully before choosing the correct answers.

2. Questions of the test

Question 1. What is unemployment a measure of?
A) The percentage of the labor force that is not currently employed but is actively seeking employment
B) The percentage of the population that is not currently in the labor force
C) The percentage of the labor force that is employed
D) The percentage of the population that is employed

Question 2. Which of the following is NOT a type of unemployment?
A) Frictional unemployment
B) Structural unemployment
C) Cyclical unemployment
D) None of the above

Question 3. Which of the following is NOT a policy measure that can be used to address unemployment?
A) Fiscal policy
B) Monetary policy
C) Social policy
D) All of the above can be used to address unemployment

Question 4. What does full employment refer to?
A) The point at which the economy is producing at its maximum capacity and unemployment is at its lowest level
B) The point at which all individuals in the labor force are employed
C) The point at which there are no unemployed individuals
D) The point at which the unemployment rate is zero

Question 5. Which of the following is NOT a potential consequence of unemployment?
A) Struggles to afford basic necessities
B) Mental health issues
C) Social unrest and political instability
D) An increase in the overall level of happiness within a society