Question 1

Define the unemployment rate and labor- force participation rate. Discuss the differences between these two rates.

Accepted Answer

The unemployment rate is defined as [(nu

Question 2

Which of the following would NOT be counted as unemployed?

Accepted Answer

A)  a person who is waiting to be called back to a job after having been laid off 
B)  a person who performs traditional housework but does not work outside the home for pay 
C)  a person who is not working but who has tried to find a job in the past week 
D)  a person who is waiting to start a new job in the next 30 days 
A)  a person who is waiting to be called back to a job after having been laid off 
B)  a person who performs traditional housework but does not work outside the home for pay 
C)  a person who is not working but who has tried to find a job in the past week 
D)  a person who is waiting to start a new job in the next 30 days

Question 3

The table below shows the price index for China starting in 2000.  
Which of the following statements correctly describe the behavior of prices in China?

Accepted Answer

A)  The cost of the CPI basket decreased in 2002. 
B)  China experienced a high price level and high inflation. 
C)  The inflation rate between 2005 and 2006 was 14.4 percent. 
D)  Inflation reached 73% between the base year and 2001. 
A)  The cost of the CPI basket decreased in 2002. 
B)  China experienced a high price level and high inflation. 
C)  The inflation rate between 2005 and 2006 was 14.4 percent. 
D)  Inflation reached 73% between the base year and 2001.

Question 4

Frictional unemployment comes about because of

Accepted Answer

A)  a mismatch between skills and available jobs. 
B)  a general economic slowdown. 
C)  friction between labor and management. 
D)  normal labor market turnover. 
A)  a mismatch between skills and available jobs. 
B)  a general economic slowdown. 
C)  friction between labor and management. 
D)  normal labor market turnover.

Question 5

If the basket of goods and services used to calculate the CPI cost $200 in the reference base period and $450 in a later year, the CPI for the latter year equals

Accepted Answer

A)  325. 
B)  225. 
C)  200. 
D)  450. 
A)  325. 
B)  225. 
C)  200. 
D)  450.

Question 6

Suppose that the price level was 100 in 2008, 110 in 2009, and 130 in 2010. Over these three years,

Accepted Answer

A)  deflation occurred at an accelerating rate. 
B)  prices were stable. 
C)  the inflation rate was positive and accelerating. 
D)  the inflation rate was positive but slowing. 
A)  deflation occurred at an accelerating rate. 
B)  prices were stable. 
C)  the inflation rate was positive and accelerating. 
D)  the inflation rate was positive but slowing.

Question 7

Based on the following data for the country of Tiny Town, the employment- to- population ratio equals _ multiplied by 100.
Population = 200
Working age population = 100 Labor Force = 90
Number of employed persons = 75

Accepted Answer

A)  90/100. 
B)  75/200 
C)  75/100. 
D)  90/200. 
A)  90/100. 
B)  75/200 
C)  75/100. 
D)  90/200.

Question 8

In 2000, you could buy a Cadillac DTS for $45,000. In 2008, the Cadillac DTS sold for $53,000. While both models include anti- lock brakes and airbags (along with other similar features), the 2008 model also includes satellite radio and new technology that provides improved gas mileage and safer driving. If the Cadillac DTS was included in the CPI basket, it would create

Accepted Answer

A)  an upward bias in the CPI as a result of commodity substitution bias. 
B)  a downward bias in the CPI as a result of new goods bias. 
C)  an upward bias in the CPI as a result of quality change bias. 
D)  a downward bias in the inflation rate. 
A)  an upward bias in the CPI as a result of commodity substitution bias. 
B)  a downward bias in the CPI as a result of new goods bias. 
C)  an upward bias in the CPI as a result of quality change bias. 
D)  a downward bias in the inflation rate.

Question 9

Full employment occurs when the

Accepted Answer

A)  structural unemployment rate equals the frictional unemployment rate. 
B)  cyclical unemployment rate equals the natural unemployment rate. 
C)  unemployment rate equals the natural unemployment rate. 
D)  natural unemployment rate equals the frictional unemployment rate. 
A)  structural unemployment rate equals the frictional unemployment rate. 
B)  cyclical unemployment rate equals the natural unemployment rate. 
C)  unemployment rate equals the natural unemployment rate. 
D)  natural unemployment rate equals the frictional unemployment rate.

Question 10

Frictional unemployment is the result of

Accepted Answer

A)  irresponsible workers with poor work habits. 
B)  a slowdown in the rate of economic expansion. 
C)  normal labor market turnover. 
D)  technological change or foreign competition. 
A)  irresponsible workers with poor work habits. 
B)  a slowdown in the rate of economic expansion. 
C)  normal labor market turnover. 
D)  technological change or foreign competition.

Question 11

The unemployment rate measures the percentage of the working- age population who can't find a job.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following most likely would decrease frictional unemployment?

Accepted Answer

A)  an expansion of unemployment compensation benefits 
B)  effective Internet- based employment services and job registries 
C)  an increase in the number of high school and college graduates 
D)  All of the above would decrease frictional unemployment. 
A)  an expansion of unemployment compensation benefits 
B)  effective Internet- based employment services and job registries 
C)  an increase in the number of high school and college graduates 
D)  All of the above would decrease frictional unemployment.

Question 13

Looking at inflation rates in the United States since the 1970s we see that

Accepted Answer

A)  the inflation rate increased with the increased growth of the 1990s. 
B)  inflation fell the most during the 1970s productivity slowdown. 
C)  the highest inflation rates were the double digits during the 1990s. 
D)  the 1970s experienced the highest inflation rates. 
A)  the inflation rate increased with the increased growth of the 1990s. 
B)  inflation fell the most during the 1970s productivity slowdown. 
C)  the highest inflation rates were the double digits during the 1990s. 
D)  the 1970s experienced the highest inflation rates.

Question 14

The unemployment rate is 6 percent. If the population is 300 million, and the number unemployed is 6 million and the number employed is 94 million, what is the size of the labor force?

Accepted Answer

The labor force is the sum of

Question 15

During a recession, people drop out of the labor force because they are unable to find a job. All else the same, this

Accepted Answer

A)  increases the unemployment rate and the labor force participation rate. 
B)  increases the unemployment rate. 
C)  does not change the unemployment rate. 
D)  decreases the unemployment rate. 
A)  increases the unemployment rate and the labor force participation rate. 
B)  increases the unemployment rate. 
C)  does not change the unemployment rate. 
D)  decreases the unemployment rate.

Question 16

If the CPI this year is 175.2 and next year the CPI is 176.1, what was the inflation rate over the year?

Accepted Answer

The inflation rate e

Question 17

When cyclical unemployment is zero,

Accepted Answer

A)  structural unemployment is zero. 
B)  cyclical and frictional unemployment are zero. 
C)  the unemployment rate equals the natural unemployment rate. 
D)  frictional unemployment is zero. 
A)  structural unemployment is zero. 
B)  cyclical and frictional unemployment are zero. 
C)  the unemployment rate equals the natural unemployment rate. 
D)  frictional unemployment is zero.

Question 18

The consumer price index (CPI)

Accepted Answer

A)  is the ratio of the average price of a typical basket of goods to the cost of producing those goods. 
B)  compares the cost in the current period to the cost in a reference base period of a basket of goods typically consumed in the base period. 
C)  measures the increase in the prices of the goods included in GDP. 
D)  compares the cost of the typical basket of goods consumed in period 1 to the cost of a basket of goods typically consumed in period 2. 
A)  is the ratio of the average price of a typical basket of goods to the cost of producing those goods. 
B)  compares the cost in the current period to the cost in a reference base period of a basket of goods typically consumed in the base period. 
C)  measures the increase in the prices of the goods included in GDP. 
D)  compares the cost of the typical basket of goods consumed in period 1 to the cost of a basket of goods typically consumed in period 2.

Question 19

The employment- to- population ratio equals

Accepted Answer

A)  (number of people employed)/(labor force) × 100. 
B)  (labor force)/(working- age population) × 100. 
C)  (number of people employed)/(working- age population) × 100. 
D)  (number of people with full- time jobs)/(labor force) × 100. 
A)  (number of people employed)/(labor force) × 100. 
B)  (labor force)/(working- age population) × 100. 
C)  (number of people employed)/(working- age population) × 100. 
D)  (number of people with full- time jobs)/(labor force) × 100.

Question 20

The unemployment rate equals 100 times

Accepted Answer

A)  (the number of unemployed workers)/(the civilian population). 
B)  (the number of unemployed workers)/(the number of employed + unemployed workers). 
C)  (the number of unemployed + employed workers)/(U.S. population older than 16 years of age). 
D)  (the number of unemployed workers)/(the U.S. population older than 16 years of age). 
A)  (the number of unemployed workers)/(the civilian population). 
B)  (the number of unemployed workers)/(the number of employed + unemployed workers). 
C)  (the number of unemployed + employed workers)/(U.S. population older than 16 years of age). 
D)  (the number of unemployed workers)/(the U.S. population older than 16 years of age).

Define the unemployment rate and labor- force participation rate. Discuss the differences between these two rates.

Which of the following would NOT be counted as unemployed?

The table below shows the price index for China starting in 2000. Which of the following statements correctly describe the behavior of prices in China?

Frictional unemployment comes about because of

If the basket of goods and services used to calculate the CPI cost $200 in the reference base period and $450 in a later year, the CPI for the latter year equals

Suppose that the price level was 100 in 2008, 110 in 2009, and 130 in 2010. Over these three years,

Based on the following data for the country of Tiny Town, the employment- to- population ratio equals _ multiplied by 100. Population = 200 Working age population = 100 Labor Force = 90 Number of employed persons = 75

Full employment occurs when the

Frictional unemployment is the result of

The unemployment rate measures the percentage of the working- age population who can't find a job.

Which of the following most likely would decrease frictional unemployment?

Looking at inflation rates in the United States since the 1970s we see that

The unemployment rate is 6 percent. If the population is 300 million, and the number unemployed is 6 million and the number employed is 94 million, what is the size of the labor force?

During a recession, people drop out of the labor force because they are unable to find a job. All else the same, this

If the CPI this year is 175.2 and next year the CPI is 176.1, what was the inflation rate over the year?

When cyclical unemployment is zero,

The consumer price index (CPI)

The employment- to- population ratio equals

The unemployment rate equals 100 times

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 5: Monitoring Jobs and Inflation

Define the unemployment rate and labor- force participation rate. Discuss the differences between these two rates.

Which of the following would NOT be counted as unemployed?

The table below shows the price index for China starting in 2000. Which of the following statements correctly describe the behavior of prices in China?

Frictional unemployment comes about because of

If the basket of goods and services used to calculate the CPI cost $200 in the reference base period and $450 in a later year, the CPI for the latter year equals

Suppose that the price level was 100 in 2008, 110 in 2009, and 130 in 2010. Over these three years,

Based on the following data for the country of Tiny Town, the employment- to- population ratio equals _ multiplied by 100. Population = 200 Working age population = 100 Labor Force = 90 Number of employed persons = 75

Full employment occurs when the

Frictional unemployment is the result of

The unemployment rate measures the percentage of the working- age population who can't find a job.

Which of the following most likely would decrease frictional unemployment?

Looking at inflation rates in the United States since the 1970s we see that

The unemployment rate is 6 percent. If the population is 300 million, and the number unemployed is 6 million and the number employed is 94 million, what is the size of the labor force?

During a recession, people drop out of the labor force because they are unable to find a job. All else the same, this

If the CPI this year is 175.2 and next year the CPI is 176.1, what was the inflation rate over the year?

When cyclical unemployment is zero,

The consumer price index (CPI)

The employment- to- population ratio equals

The unemployment rate equals 100 times

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters