Economists Erica Goshen and Simon Potter Note That When a Layoff

question 52

Multiple Choice

Economists Erica Goshen and Simon Potter note that when a layoff is temporary, the employer "suspends" the job, due to slack demand, and the employee expects to be recalled once demand picks up.With a permanent layoff, the employer eliminates the job.Which of the following statements is consistent with their observations?

• A)Temporary and permanent layoffs create cyclical unemployment.
• B)Temporary and permanent layoffs create structural unemployment.
• C)Temporary layoffs create structural unemployment while permanent layoffs create cyclical unemployment.
• D)Temporary layoffs create cyclical unemployment while permanent layoffs create structural unemployment.

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Definitions:

Covariance

A measure of linear association between two variables. Positive values indicate a positive relationship; negative values indicate a negative relationship.

Variables

Elements, features, or factors that are capable of changing or varying across different conditions or within different individuals in a study.

Population Standard Deviation

A measure of the dispersion of a dataset relative to its mean, calculated for the entire population.

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