Exam 5: Macroeconomics: the Big Picture

Table 5-2 shows the market basket for a typical college student. Use this data to answer questions . Table 5-2 -Refer to Table 5-2. Suppose the base year is 2008. What is the value of the price index in 2007?

Which of the following individuals would NOT be included in the labor force?

The costs of the market basket in the current period will be compared against the costs of the market basket in _____ when computing a price index.

A country's structural unemployment rate is 3.2%, the natural unemployment rate is 5.6%, and the cyclical unemployment rate is 4.7%. The frictional unemployment rate is _____ and the unemployment rate is _____.

Table 5-7 shows a mechanic's hourly wage and the respective price indexes for the years 1975 and 2005. Use the table to answer questions . Table 5-7 -Refer to Table 5-7. Which of the following statements is true?

Which of the following is NOT a consequence of deflation?

A business cycle is complete when an economy moves from one peak to the next.

Which of the following reduces the duration of frictional unemployment?

A quality-change bias in the construction of the CPI arises because:

Consider a bakery that buys flour to bake cakes. Which of the following statements is true?

Which of the following is an example of cyclical unemployment?

If the population of the United States is 260 million, the labor force is 130 million, and 120 million workers are employed, the rate of unemployment is _____.

Over time, _____ has/have been the general trend for most economies.

The point on a business cycle when real GDP stops falling and begins rising is called a(n):

Your grandfather tells you that his Social Security payments are indexed. What does this mean?

The PCE price index is computed using a fixed market basket.

What is the difference between a nominal value and a real value?

A number of semi-skilled workers in an industry find themselves out of work when improvements in technology render their jobs obsolete. These workers experience _____ unemployment.

Table 5-2 shows the market basket for a typical college student. Use this data to answer questions . Table 5-2 -Refer to Table 5-2. Suppose the base year is 2007. What is the value of the price index in 2008?

The peak of the business cycle: