An Important Development During the Great Recession of 2007-2010 Was

question 6

Multiple Choice

An important development during the Great Recession of 2007-2010 was that

• A)more than 35 percent of all unemployed workers remained unemployed for more than 26 months.
• B)most unemployment spells lasted 13 to 26 weeks.
• C)the unemployment rate increased dramatically, but the average unemployment spell remained constant at about 8 weeks of unemployment.
• D)more than 70 percent of all unemployed workers exited unemployment within 5 weeks; however, most of this movement was due to the unemployed becoming discouraged and exiting the labor force rather than finding a job.
• E)the amount of frictional and seasonal unemployment increased dramatically while the amount of structural unemployment decreased substantially.

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Definitions:

No Externality

A situation where private costs or benefits are equal to social costs or benefits, with no spillover effects on third parties.

Market

An arrangement or venue where parties engage in exchange of goods and services.

Positive Externality

A benefit that is enjoyed by a third-party as a result of an economic transaction or activity in which they did not directly participate.

Marginal Social Benefit

The additional benefit to society from consuming one more unit of a good or service.