1. Unemployment arising from a mismatch between the skills desired by firms and
ID: 1147081 • Letter: 1
Question
1. Unemployment arising from a mismatch between the skills desired by firms and the skills offered by work (a) frictional unemployment. (b) structural unemployment. (c) demand deficient unemployment. (d) seasonal unemployment. ers is called: 2. A decrease in the number of job vacancies and increase in the number of unemployed persons is a sign of greater: (a) frictional unemployment. (b) structural unemployment. (c) cyclical unemployment. (d) either frictional or structural unemployment. 3. Which of the following will lead to a decrease in the average length of job search (a) a recession. (b) a greater number of women in the labor force. (c) an increase in the maximum number of weeks of unemployment compensation benefits. (d) none of the aboveExplanation / Answer
1. (b) Structural unemployment.
Explanation: In frictional unemployment, people are between jobs i.e. it is a temporary unemployment. So, option a is invalid.
In structural unemployment, the unemployed don't have the required skills for the available jobs in the economy. So, option b is valid.
Demand deficient unemployment is a cyclical unemployment which happens because of recessions (when demand goes down) in the businesses cycle. So, option c is invalid.
Seasonal unemployment takes place because of changes in labor requirements with changing seasons. So, option d is also invalid.
2. C. Cyclical Unemployment
Explanation: In cyclical or demand-deficient unemployment, firms lay off workers due to fall in demand in recessions.
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