Exam 5: Macroeconomics: the Big Picture

Use the following to answer questions. Exhibit: Consumer Price Index for a City -(Exhibit: Consumer Price Index for a City) The base year is 2002. What is the inflation rate in 2004?

Unemployment that results from a mismatch between worker qualifications and the characteristics employers require is called _____ unemployment.

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

The inflation rate in the year 2007 is defined as:

Based on the Case in Point titled "Take Me Out to the Ball Game . . .", suppose the average price of the baseball fan market basket was $121.36 in 1998, compared to $219.53 (for the same basket) in 2016. Calculate the inflation rate experienced by a typical baseball fan over this period.

(Exhibit: Employment Data for an Economy) -(Exhibit: Employment Data for an Economy) Now suppose 4,000 of the people looking for work get discouraged and give up their job searches. The unemployment rate becomes _____.

Suppose nominal GDP in a country rose in the third quarter of 2008 (from the second quarter). Yet, real GDP fell in the third quarter of 2008. What could have accounted for this?

Since late 2006, OPEC has successfully raised world oil prices significantly. These price increases have caused governments and firms to explore alternative sources of energy, for example bio-fuels. Consumers too have started switching toward hybrid automobiles and toward automobiles that use bio-fuels, both of which are cheaper to operate than gasoline engines. Which problems in the construction of the CPI does this situation represent?

Typically, an economy is said to be in a recession when the nominal GDP drops for at least four consecutive quarters.

The CPI is used for calculating payments from the U.S. government to individuals. To the extent that it is biased upward, which of the following is likely to occur?

Which of the following is true of cyclical unemployment?

Both unexpected inflation and unexpected deflation create uncertainty about the future.

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

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

When the media reports the U.S. inflation rate, the number cited is usually a rate computed using:

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

Use the following to answer questions . Exhibit: Market Basket for a Typical College Student -(Exhibit: Market Basket for a Typical College Student) Suppose the base year is 2007. What is the value of the price index in 2007?

Which of the following individuals benefits from inflation?

Economic data that are adjusted for price-level changes are said to be expressed in terms of:

According to the Bureau of Labor Statistics, a person who is not working and is not looking for work is: