Question 1

If 1999 is the base year and the inflation rate between 1999 and 2000 is - 12%, the price index in 2000 must be equal to:

Accepted Answer

A)  88. 
B)  - 120. 
C)  120. 
D)  cannot be determined from this information because the base year is not known 
A)  88. 
B)  - 120. 
C)  120. 
D)  cannot be determined from this information because the base year is not known

Question 2

Suppose that Linda wants to calculate a price index for the goods that she commonly purchases each week. The cost of her bundle of goods and services was $350 in 2008, $445 in 1999, and $470 in 2010. If Linda uses 2008 as the base year, what will be the value of her price index for 2008, 2009, and 2010?

Accepted Answer

For 2008, the price index will

Question 3

Recall Application 2, "More Disability, Less Unemployment?" to answer the following questions:
-According to the application, the changes in the federal Disability Insurance program:

Accepted Answer

A)  encouraged more individuals to claim disability and stay employed. 
B)  encouraged more individuals to claim disability and stay unemployed. 
C)  encouraged more individuals to claim disability and stay out of the labor force. 
D)  encouraged more individuals to look for work. 
A)  encouraged more individuals to claim disability and stay employed. 
B)  encouraged more individuals to claim disability and stay unemployed. 
C)  encouraged more individuals to claim disability and stay out of the labor force. 
D)  encouraged more individuals to look for work.

Question 4

In 1999, the U.S. population 16 years old or older was 207.8 million, the number employed was 133.5 million, the number unemployed was 5.9 million, and the labor force was 139.4 million. The labor- force participation rate in 1999 was _______%.

Accepted Answer

A)  4.2 
B)  95.8 
C)  67.1 
D)  64.2 
A)  4.2 
B)  95.8 
C)  67.1 
D)  64.2

Question 5

If the price index in 2000 is 120 and the price index in 2001 is 112, then the economy experiences _______ between 2000 and 2001.

Accepted Answer

A)  disinflation 
B)  hyperinflation 
C)  deflation 
D)  inflation 
A)  disinflation 
B)  hyperinflation 
C)  deflation 
D)  inflation

Question 6

COLA is an acronym that stands for

Accepted Answer

A)  Cost of Living Alone. 
B)  Cost of Living Adjustment. 
C)  Cost of Living Annually. 
D)  Cost of Living Account. 
A)  Cost of Living Alone. 
B)  Cost of Living Adjustment. 
C)  Cost of Living Annually. 
D)  Cost of Living Account.

Question 7

Which of the following is not an example of seasonal unemployment?

Accepted Answer

A)  lost farming jobs during the winter 
B)  lost accounting jobs after April 
C)  lost textiles jobs due to a recession 
D)  lost retail jobs after the Christmas 
A)  lost farming jobs during the winter 
B)  lost accounting jobs after April 
C)  lost textiles jobs due to a recession 
D)  lost retail jobs after the Christmas

Question 8

Recall Application 1, "After Growing Sharply, Women's Labor Force Participation Has Leveled Off," to answer the
following questions:
-In the application, the labor- force participation rate of women 20 years or older in 1997 has reached:

Accepted Answer

A)  40 percent. 
B)  60 percent. 
C)  50 percent. 
D)  70 percent. 
A)  40 percent. 
B)  60 percent. 
C)  50 percent. 
D)  70 percent.

Question 9

-Refer to Table 6.11. If 1999 is the base year, the price index in 2001 is:

Accepted Answer

A)  1998. 
B)  121.7. 
C)  100. 
D)  138.7. 
A)  1998. 
B)  121.7. 
C)  100. 
D)  138.7.

Question 10

If the labor force is 250,000 and the total population 16 years of age or older is 300,000, the labor- force participation rate is:

Accepted Answer

A)  79.5%. 
B)  80.9%. 
C)  45.4%. 
D)  83.3%. 
A)  79.5%. 
B)  80.9%. 
C)  45.4%. 
D)  83.3%.

Question 11

The unemployment rate is the ratio of the number of people unemployed to the total population 16 years of age or older.

Accepted Answer

A) True 
 B)False

Question 12

If the number of unemployed equals 20,000, the number of employed equals 60,000, and the total population 16 years of age and older is 90,000, the labor- force participation rate:

Accepted Answer

A)  is 33.33%. 
B)  is 88.9%. 
C)  is 66.2%. 
D)  cannot be determined from this information. 
A)  is 33.33%. 
B)  is 88.9%. 
C)  is 66.2%. 
D)  cannot be determined from this information.

Question 13

Deflation is a great economic problem because:

Accepted Answer

A)  Social Security costs rise very fast. 
B)  people have difficulty paying back their debts. 
C)  consumers can not afford to maintain their usual lifestyles. 
D)  firms have a difficult time selling their goods and services. 
A)  Social Security costs rise very fast. 
B)  people have difficulty paying back their debts. 
C)  consumers can not afford to maintain their usual lifestyles. 
D)  firms have a difficult time selling their goods and services.

Question 14

For each of the following, indicate if the person would be classified as employed, unemployed, or not in the labor force:
(a) a 70- year- old man who left his job to help his daughter in her business for 10 hours a week,
(b) a 20- year- old college student who is out of school for the summer and is looking for a job,
(c) a 30- year- old woman with a Ph.D. in history who has not been able to find a teaching position and is driving a cab 30 hours a week,
(d) a 40- year- old steel worker who isn't working and has given up searching for a job,
(e) a 14- year- old movie star starts working on a new episode of Star Trek.

Accepted Answer

(a) not in the labor force
(b)

Question 15

Based on statistics on unemployment, which group of workers experience the highest unemployment rates?

Accepted Answer

A)  African American, 16- 19 years old 
B)  women maintaining families 
C)  unmarried men 
D)  White, 16- 19 years old 
A)  African American, 16- 19 years old 
B)  women maintaining families 
C)  unmarried men 
D)  White, 16- 19 years old

Question 16

Anticipated inflation hurts the lenders and benefits the borrowers.

Accepted Answer

A) True 
 B)False

Question 17

Recall Application 4, "The Introduction of Cell Phones and the Bias in the CPI," to answer the following questions:
-According to the application, the failure to include cell phones in the calculation of the CPI creates an upward bias on the telecommunications component of the CPI by 0.8 to 1.9 percent. If the measured inflation for telecommunications was 5%, then the actual inflation was somewhere between:

Accepted Answer

A)  0.8 to 1.9 percent. 
B)  5.8 to 6.9 percent. 
C)  5.9 to 6.8 percent 
D)  3.1 to 4.2 percent. 
A)  0.8 to 1.9 percent. 
B)  5.8 to 6.9 percent. 
C)  5.9 to 6.8 percent 
D)  3.1 to 4.2 percent.

Question 18

If the number of people classified as unemployed is 50,000 and the number of people classified as employed is 620,000, what is the unemployment rate?

Accepted Answer

A)  15.6% 
B)  8.1% 
C)  9.2% 
D)  7.5% 
A)  15.6% 
B)  8.1% 
C)  9.2% 
D)  7.5%

Question 19

NEETS ARE THE NEW DISCOURAGED WORKERS IN JAPAN
Who are the new discouraged workers in Japan?
In Japan, there is growing concern about young people who are not joining the labor force. Young workers who have given up looking for work and often receive support from their parents are known as NEETs—"not in education, employment, or training." Because Japan has an aging population and does not encourage immigration, it is concerned about labor shortages and has focused attention on the NEETs. Many in Japan are concerned over this phenomenon because it potentially signals a change in the strong Japanese work ethic.

However, the number of individuals in this category is quite small, only 2 percent of Japan’s 33 million young people between the ages of 15 and 34. Nonetheless, the fact that the Japanese decided to name this group suggests that it is socially significant to them. In the United States, individuals not seeking work and supported by their parents would be out of the labor force and possibly marginally attached workers.
-Labor shortages in Japan increased focus on the NEETs. This labor shortage is caused by:

Accepted Answer

A)  a strong work ethic. 
B)  a population boom. 
C)  an aging population. 
D)  a recession. 
A)  a strong work ethic. 
B)  a population boom. 
C)  an aging population. 
D)  a recession.

Question 20

If you expect that the inflation rate is 5 percent and the actual inflation rate turned out to be exactly 8 percent, then:

Accepted Answer

A)  lenders gain. 
B)  borrowers gain. 
C)  both the borrowers and lenders gain. 
D)  neither borrowers nor lenders gain. 
A)  lenders gain. 
B)  borrowers gain. 
C)  both the borrowers and lenders gain. 
D)  neither borrowers nor lenders gain.

If 1999 is the base year and the inflation rate between 1999 and 2000 is - 12%, the price index in 2000 must be equal to:

Recall Application 2, "More Disability, Less Unemployment?" to answer the following questions: -According to the application, the changes in the federal Disability Insurance program:

In 1999, the U.S. population 16 years old or older was 207.8 million, the number employed was 133.5 million, the number unemployed was 5.9 million, and the labor force was 139.4 million. The labor- force participation rate in 1999 was _______%.

If the price index in 2000 is 120 and the price index in 2001 is 112, then the economy experiences _______ between 2000 and 2001.

COLA is an acronym that stands for

Which of the following is not an example of seasonal unemployment?

Recall Application 1, "After Growing Sharply, Women's Labor Force Participation Has Leveled Off," to answer the following questions: -In the application, the labor- force participation rate of women 20 years or older in 1997 has reached:

-Refer to Table 6.11. If 1999 is the base year, the price index in 2001 is:

If the labor force is 250,000 and the total population 16 years of age or older is 300,000, the labor- force participation rate is:

The unemployment rate is the ratio of the number of people unemployed to the total population 16 years of age or older.

If the number of unemployed equals 20,000, the number of employed equals 60,000, and the total population 16 years of age and older is 90,000, the labor- force participation rate:

Deflation is a great economic problem because:

Based on statistics on unemployment, which group of workers experience the highest unemployment rates?

Anticipated inflation hurts the lenders and benefits the borrowers.

If the number of people classified as unemployed is 50,000 and the number of people classified as employed is 620,000, what is the unemployment rate?

If you expect that the inflation rate is 5 percent and the actual inflation rate turned out to be exactly 8 percent, then:

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Measuring a Nations Production and Income

The Economy at Full Employment

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

The Income-Expenditure Model

Investment and Financial Markets

Money and the Banking System

The Federal Reserve and Monetary Policy

Modern Macroeconomics: From the Short Run to the Long Run

The Dynamics of Inflation and Unemployment

Macroeconomic Policy Debates

International Trade and Public Policy

The World of International Finance

Filters

Exam 6: Unemployment and Inflation

If 1999 is the base year and the inflation rate between 1999 and 2000 is - 12%, the price index in 2000 must be equal to:

Recall Application 2, "More Disability, Less Unemployment?" to answer the following questions: -According to the application, the changes in the federal Disability Insurance program:

In 1999, the U.S. population 16 years old or older was 207.8 million, the number employed was 133.5 million, the number unemployed was 5.9 million, and the labor force was 139.4 million. The labor- force participation rate in 1999 was _______%.

If the price index in 2000 is 120 and the price index in 2001 is 112, then the economy experiences _______ between 2000 and 2001.

COLA is an acronym that stands for

Which of the following is not an example of seasonal unemployment?

Recall Application 1, "After Growing Sharply, Women's Labor Force Participation Has Leveled Off," to answer the following questions: -In the application, the labor- force participation rate of women 20 years or older in 1997 has reached:

-Refer to Table 6.11. If 1999 is the base year, the price index in 2001 is:

If the labor force is 250,000 and the total population 16 years of age or older is 300,000, the labor- force participation rate is:

The unemployment rate is the ratio of the number of people unemployed to the total population 16 years of age or older.

If the number of unemployed equals 20,000, the number of employed equals 60,000, and the total population 16 years of age and older is 90,000, the labor- force participation rate:

Deflation is a great economic problem because:

Based on statistics on unemployment, which group of workers experience the highest unemployment rates?

Anticipated inflation hurts the lenders and benefits the borrowers.

If the number of people classified as unemployed is 50,000 and the number of people classified as employed is 620,000, what is the unemployment rate?

If you expect that the inflation rate is 5 percent and the actual inflation rate turned out to be exactly 8 percent, then:

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Measuring a Nations Production and Income

The Economy at Full Employment

Why Do Economies Grow

Aggregate Demand and Aggregate Supply

Fiscal Policy

The Income-Expenditure Model

Investment and Financial Markets

Money and the Banking System

The Federal Reserve and Monetary Policy

Modern Macroeconomics: From the Short Run to the Long Run

The Dynamics of Inflation and Unemployment

Macroeconomic Policy Debates

International Trade and Public Policy

The World of International Finance

Filters