Question 1

Inflation affects borrowers and lenders differently.After signing a contract with a fixed nominal interest rate,it can be expected that

Accepted Answer

A)  borrowers will hope that prices fall. 
B)  lenders will hope that prices rise. 
C)  lenders will hope that the purchasing power of money will fall. 
D)  borrowers will hope that prices rise. 
A)  borrowers will hope that prices fall. 
B)  lenders will hope that prices rise. 
C)  lenders will hope that the purchasing power of money will fall. 
D)  borrowers will hope that prices rise.

Question 2

One of the determinants of real GDP is output per hour of labor.This statistic is called labor

Accepted Answer

A)  force growth. 
B)  productivity. 
C)  force participation. 
D)  force input. 
A)  force growth. 
B)  productivity. 
C)  force participation. 
D)  force input.

Question 3

Older Americans living on a pension and therefore on a fixed income,tend to be made

Accepted Answer

A)  better off when prices rise. 
B)  better off when inflation rates rise. 
C)  worse off when prices rise. 
D)  worse off when prices fall. 
A)  better off when prices rise. 
B)  better off when inflation rates rise. 
C)  worse off when prices rise. 
D)  worse off when prices fall.

Question 4

If the rate of technical progress decreases,then the growth

Accepted Answer

A)  of the labor force will decrease. 
B)  of the capital stock will decrease. 
C)  rate of potential GDP will decrease. 
D)  rate of unemployment will decrease. 
A)  of the labor force will decrease. 
B)  of the capital stock will decrease. 
C)  rate of potential GDP will decrease. 
D)  rate of unemployment will decrease.

Question 5

How is the unemployment rate calculated? Describe the three principal types of unemployment.

Accepted Answer

The unemployment rate is a percentage ob

Question 6

The United States has never suffered through periods of hyperinflation in its history.

Accepted Answer

A) True 
 B)False

Question 7

Frictional unemployment is a "necessary" cost of a dynamic economy.

Accepted Answer

A) True 
 B)False

Question 8

The unemployment rate that many economists believe represents full employment is

Accepted Answer

A)  0 percent. 
B)  0-4 percent. 
C)  4-6 percent. 
D)  6-8 percent. 
E)  8-10 percent 
A)  0 percent. 
B)  0-4 percent. 
C)  4-6 percent. 
D)  6-8 percent. 
E)  8-10 percent

Question 9

The shortfall between actual real GDP and potential GDP

Accepted Answer

A)  decreases as the unemployment rate rises. 
B)  increases as the unemployment rate rises. 
C)  increases as the employment rate rises. 
D)  decreases as the labor force increases. 
A)  decreases as the unemployment rate rises. 
B)  increases as the unemployment rate rises. 
C)  increases as the employment rate rises. 
D)  decreases as the labor force increases.

Question 10

Technological change and labor productivity are negatively related.

Accepted Answer

A) True 
 B)False

Question 11

Describe how the labor force,the nation's capital stock,and the rate of technical progress contribute to potential GDP growth and labor productivity.

Accepted Answer

Potential GDP growth depends on the grow

Question 12

Inflation tends to redistribute real income from lenders to borrowers.

Accepted Answer

A) True 
 B)False

Question 13

The fastest growing economy between 1870 and 1979 was

Accepted Answer

A)  the United Kingdom. 
B)  the United States. 
C)  Japan. 
D)  Brazil. 
A)  the United Kingdom. 
B)  the United States. 
C)  Japan. 
D)  Brazil.

Question 14

The unemployment rate is the number of unemployed people,expressed as

Accepted Answer

A)  a ratio of total employed to the population. 
B)  a ratio of unemployed to the total employed. 
C)  a percentage of the labor force. 
D)  a percentage of the population. 
A)  a ratio of total employed to the population. 
B)  a ratio of unemployed to the total employed. 
C)  a percentage of the labor force. 
D)  a percentage of the population.

Question 15

One of the distinguishing differences between periods of low inflation and periods of high inflation is that

Accepted Answer

A)  low inflation periods are short-lived. 
B)  high inflation periods are short-lived. 
C)  high inflation periods are long-lived. 
D)  low inflation leads to high inflation. 
A)  low inflation periods are short-lived. 
B)  high inflation periods are short-lived. 
C)  high inflation periods are long-lived. 
D)  low inflation leads to high inflation.

Question 16

The growth rate in potential GDP is equal to the growth rate in the population.

Accepted Answer

A) True 
 B)False

Question 17

The real wage rate is defined as the wage rate divided by

Accepted Answer

A)  the interest rate. 
B)  the money supply. 
C)  nominal GDP. 
D)  the price level. 
A)  the interest rate. 
B)  the money supply. 
C)  nominal GDP. 
D)  the price level.

Question 18

Taxes on capital gains and interest decline as inflation rates increase.

Accepted Answer

A) True 
 B)False

Question 19

Unemployment insurance has an important macroeconomic effect because it

Accepted Answer

A)  props up aggregate supply. 
B)  props up aggregate demand. 
C)  props up aggregate exports. 
D)  helps balance the federal budget. 
A)  props up aggregate supply. 
B)  props up aggregate demand. 
C)  props up aggregate exports. 
D)  helps balance the federal budget.

Question 20

Businesses will want to borrow more funds as the real rate of interest decreases.

Accepted Answer

A) True 
 B)False

Inflation affects borrowers and lenders differently.After signing a contract with a fixed nominal interest rate,it can be expected that

One of the determinants of real GDP is output per hour of labor.This statistic is called labor

Older Americans living on a pension and therefore on a fixed income,tend to be made

If the rate of technical progress decreases,then the growth

How is the unemployment rate calculated? Describe the three principal types of unemployment.

The United States has never suffered through periods of hyperinflation in its history.

Frictional unemployment is a "necessary" cost of a dynamic economy.

The unemployment rate that many economists believe represents full employment is

The shortfall between actual real GDP and potential GDP

Technological change and labor productivity are negatively related.

Describe how the labor force,the nation's capital stock,and the rate of technical progress contribute to potential GDP growth and labor productivity.

Inflation tends to redistribute real income from lenders to borrowers.

The fastest growing economy between 1870 and 1979 was

The unemployment rate is the number of unemployed people,expressed as

One of the distinguishing differences between periods of low inflation and periods of high inflation is that

The growth rate in potential GDP is equal to the growth rate in the population.

The real wage rate is defined as the wage rate divided by

Taxes on capital gains and interest decline as inflation rates increase.

Unemployment insurance has an important macroeconomic effect because it

Businesses will want to borrow more funds as the real rate of interest decreases.

What Is Economics

The Economy Myth and Reality

The Fundamental Economic Problem Scarcity and Choice

Supply and Demand An Initial Look

An Introduction To Macroeconomics

Economic Growth Theory And Policy

Aggregate Demand and The Powerful Consumer

Demand Side Equilibrium Unemployment Or Inflation

Bringing In The Supply Side Unemployment and Inflation

Managing Aggregate Demand Fiscal Policy

Money and The Banking System

Monetary Policy Conventional and Unconventional

The Financial Crisis and The Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits In The Short and Long Run

The Trade Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System Order Or Disorder

Exchange Rates and The Macroeconomy

Filters

Exam 6: The Goals Of Macroeconomic Policy

Inflation affects borrowers and lenders differently.After signing a contract with a fixed nominal interest rate,it can be expected that

One of the determinants of real GDP is output per hour of labor.This statistic is called labor

Older Americans living on a pension and therefore on a fixed income,tend to be made

If the rate of technical progress decreases,then the growth

How is the unemployment rate calculated? Describe the three principal types of unemployment.

The United States has never suffered through periods of hyperinflation in its history.

Frictional unemployment is a "necessary" cost of a dynamic economy.

The unemployment rate that many economists believe represents full employment is

The shortfall between actual real GDP and potential GDP

Technological change and labor productivity are negatively related.

Describe how the labor force,the nation's capital stock,and the rate of technical progress contribute to potential GDP growth and labor productivity.

Inflation tends to redistribute real income from lenders to borrowers.

The fastest growing economy between 1870 and 1979 was

The unemployment rate is the number of unemployed people,expressed as

One of the distinguishing differences between periods of low inflation and periods of high inflation is that

The growth rate in potential GDP is equal to the growth rate in the population.

The real wage rate is defined as the wage rate divided by

Taxes on capital gains and interest decline as inflation rates increase.

Unemployment insurance has an important macroeconomic effect because it

Businesses will want to borrow more funds as the real rate of interest decreases.

What Is Economics

The Economy Myth and Reality

The Fundamental Economic Problem Scarcity and Choice

Supply and Demand An Initial Look

An Introduction To Macroeconomics

Economic Growth Theory And Policy

Aggregate Demand and The Powerful Consumer

Demand Side Equilibrium Unemployment Or Inflation

Bringing In The Supply Side Unemployment and Inflation

Managing Aggregate Demand Fiscal Policy

Money and The Banking System

Monetary Policy Conventional and Unconventional

The Financial Crisis and The Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits In The Short and Long Run

The Trade Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System Order Or Disorder

Exchange Rates and The Macroeconomy

Filters