Question 1

Frictional and structural unemployment are a part of the natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 2

Structural unemployment consists of people who are unemployed because of:

Accepted Answer

A)  temporary changes in jobs. 
B)  there being more labor demanded than there is labor supplied. 
C)  the time it takes for employers and workers to find each other. 
D)  there being more job hunters than there are jobs. 
A)  temporary changes in jobs. 
B)  there being more labor demanded than there is labor supplied. 
C)  the time it takes for employers and workers to find each other. 
D)  there being more job hunters than there are jobs.

Question 3

The severe inflation in Israel during the mid-1980s was due to a war, an unstable government, and civil unrest in the country.

Accepted Answer

A) True 
 B)False

Question 4

Jim has a part-time job. He would prefer to have a full-time job but has been unable to find one. Jim is classified as:

Accepted Answer

A)  a discouraged worker. 
B)  underemployed. 
C)  unemployed. 
D)  out of the labor force. 
A)  a discouraged worker. 
B)  underemployed. 
C)  unemployed. 
D)  out of the labor force.

Question 5

Suppose that Allison has an accounting degree, but she lost her job two months ago when her company merged with another firm. Allison hasn't been able to find another accounting job, so she has taken a part-time job as a sales clerk at a clothing store. The Bureau of Labor Statistics classifies Allison as:

Accepted Answer

A)  a marginally attached worker. 
B)  a discouraged worker. 
C)  underemployed. 
D)  unemployed. 
A)  a marginally attached worker. 
B)  a discouraged worker. 
C)  underemployed. 
D)  unemployed.

Question 6

The rate of unemployment is found by dividing the:

Accepted Answer

A)  number of people looking for work by the population. 
B)  number of people not working but looking for work by the sum of the number of people not working but looking for work and the number of people employed. 
C)  labor force by the number of people looking for work. 
D)  unemployed and discouraged workers by the labor force. 
A)  number of people looking for work by the population. 
B)  number of people not working but looking for work by the sum of the number of people not working but looking for work and the number of people employed. 
C)  labor force by the number of people looking for work. 
D)  unemployed and discouraged workers by the labor force.

Question 7

Costs of inflation do NOT include _____ costs.

Accepted Answer

A)  menu 
B)  shoe-leather 
C)  unit-of-account 
D)  efficiency-wage 
A)  menu 
B)  shoe-leather 
C)  unit-of-account 
D)  efficiency-wage

Question 8

If the U.S. dollar were replaced with a "new dollar" at an exchange rate of 1 new dollar for 4 old dollars, then an hourly wage of $12 would become an hourly wage of 3 new dollars.

Accepted Answer

A) True 
 B)False

Question 9

If the labor force becomes younger, the natural rate of unemployment will fall.

Accepted Answer

A) True 
 B)False

Question 10

If Jim's income is $80,000 and the price level is 4, then Jim's real income is:

Accepted Answer

A)  $20,000. 
B)  $320,000. 
C)  $84,000. 
D)  $80,000. 
A)  $20,000. 
B)  $320,000. 
C)  $84,000. 
D)  $80,000.

Question 11

The percentage of the labor force that is unemployed is the:

Accepted Answer

A)  labor force participation rate. 
B)  employment ratio. 
C)  unemployment rate. 
D)  natural employment rate. 
A)  labor force participation rate. 
B)  employment ratio. 
C)  unemployment rate. 
D)  natural employment rate.

Question 12

Since 1960, the price level in the United States has decreased in most years.

Accepted Answer

A) True 
 B)False

Question 13

A binding minimum wage in a labor market is set _____ the equilibrium wage and causes a _____ of labor.

Accepted Answer

A)  below; surplus 
B)  below; shortage 
C)  above; surplus 
D)  above; shortage 
A)  below; surplus 
B)  below; shortage 
C)  above; surplus 
D)  above; shortage

Question 14

If the actual unemployment rate is 7% and the cyclical unemployment rate is 2%, then the natural rate of unemployment is:

Accepted Answer

A)  2%. 
B)  5%. 
C)  7%. 
D)  9%. 
A)  2%. 
B)  5%. 
C)  7%. 
D)  9%.

Question 15

Last week, Stephanie quit her job as a copywriter at an advertising agency. She has spent the past few days browsing the help wanted ads but hasn't found anything that matches her skills. Stephanie is BEST classified as:

Accepted Answer

A)  structurally unemployed. 
B)  frictionally unemployed. 
C)  a discouraged worker. 
D)  out of the labor force. 
A)  structurally unemployed. 
B)  frictionally unemployed. 
C)  a discouraged worker. 
D)  out of the labor force.

Question 16

Economists claim that the unemployment rate can understate the true level of unemployment because the ONLY group that is included is:

Accepted Answer

A)  discouraged workers. 
B)  marginally attached workers. 
C)  underemployed workers. 
D)  workers without jobs who have looked for work in the past four weeks. 
A)  discouraged workers. 
B)  marginally attached workers. 
C)  underemployed workers. 
D)  workers without jobs who have looked for work in the past four weeks.

Question 17

Unanticipated inflation:

Accepted Answer

A)  increases the value of money. 
B)  decreases uncertainty about the future. 
C)  reduces the real value of debt. 
D)  helps lenders. 
A)  increases the value of money. 
B)  decreases uncertainty about the future. 
C)  reduces the real value of debt. 
D)  helps lenders.

Question 18

The _____ interest rate _____.

Accepted Answer

A)  nominal; can be negative 
B)  real; cannot be negative 
C)  real; can only be positive 
D)  real; can be zero, positive, or negative 
A)  nominal; can be negative 
B)  real; cannot be negative 
C)  real; can only be positive 
D)  real; can be zero, positive, or negative

Question 19

Use the following to answer questions:  
-(Table: Labor Force Data) Use Table: Labor Force Distribution. The unemployment rate is _____%.

Accepted Answer

A)  3.85 
B)  10 
C)  4.55 
D)  6.75 
A)  3.85 
B)  10 
C)  4.55 
D)  6.75

Question 20

Deflation is a:

Accepted Answer

A)  decrease in unemployment. 
B)  decreasing aggregate price level. 
C)  decline in wages. 
D)  recession. 
A)  decrease in unemployment. 
B)  decreasing aggregate price level. 
C)  decline in wages. 
D)  recession.

Frictional and structural unemployment are a part of the natural rate of unemployment.

Structural unemployment consists of people who are unemployed because of:

The severe inflation in Israel during the mid-1980s was due to a war, an unstable government, and civil unrest in the country.

Jim has a part-time job. He would prefer to have a full-time job but has been unable to find one. Jim is classified as:

The rate of unemployment is found by dividing the:

Costs of inflation do NOT include _____ costs.

If the U.S. dollar were replaced with a "new dollar" at an exchange rate of 1 new dollar for 4 old dollars, then an hourly wage of $12 would become an hourly wage of 3 new dollars.

If the labor force becomes younger, the natural rate of unemployment will fall.

If Jim's income is $80,000 and the price level is 4, then Jim's real income is:

The percentage of the labor force that is unemployed is the:

Since 1960, the price level in the United States has decreased in most years.

A binding minimum wage in a labor market is set _ the equilibrium wage and causes a _ of labor.

If the actual unemployment rate is 7% and the cyclical unemployment rate is 2%, then the natural rate of unemployment is:

Last week, Stephanie quit her job as a copywriter at an advertising agency. She has spent the past few days browsing the help wanted ads but hasn't found anything that matches her skills. Stephanie is BEST classified as:

Economists claim that the unemployment rate can understate the true level of unemployment because the ONLY group that is included is:

Unanticipated inflation:

The _ interest rate _.

Use the following to answer questions: -(Table: Labor Force Data) Use Table: Labor Force Distribution. The unemployment rate is _____%.

Deflation is a:

First Principles

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

GDP and the CPI: Tracking the Macroeconomy

Long-Run Economic Growth

Savings, Investment Spending, and the Financial Syst

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Filters

Exam 8: Unemployment and Inflation

Frictional and structural unemployment are a part of the natural rate of unemployment.

Structural unemployment consists of people who are unemployed because of:

The severe inflation in Israel during the mid-1980s was due to a war, an unstable government, and civil unrest in the country.

Jim has a part-time job. He would prefer to have a full-time job but has been unable to find one. Jim is classified as:

The rate of unemployment is found by dividing the:

Costs of inflation do NOT include _____ costs.

If the U.S. dollar were replaced with a "new dollar" at an exchange rate of 1 new dollar for 4 old dollars, then an hourly wage of $12 would become an hourly wage of 3 new dollars.

If the labor force becomes younger, the natural rate of unemployment will fall.

If Jim's income is $80,000 and the price level is 4, then Jim's real income is:

The percentage of the labor force that is unemployed is the:

Since 1960, the price level in the United States has decreased in most years.

A binding minimum wage in a labor market is set _____ the equilibrium wage and causes a _____ of labor.

If the actual unemployment rate is 7% and the cyclical unemployment rate is 2%, then the natural rate of unemployment is:

Last week, Stephanie quit her job as a copywriter at an advertising agency. She has spent the past few days browsing the help wanted ads but hasn't found anything that matches her skills. Stephanie is BEST classified as:

Economists claim that the unemployment rate can understate the true level of unemployment because the ONLY group that is included is:

Unanticipated inflation:

The _____ interest rate _____.

Use the following to answer questions: -(Table: Labor Force Data) Use Table: Labor Force Distribution. The unemployment rate is _____%.

Deflation is a:

First Principles

Economic Models: Trade-Offs and Trade

Supply and Demand

Price Controls and Quotas: Meddling With Markets

International Trade

Macroeconomics: the Big Picture

GDP and the CPI: Tracking the Macroeconomy

Long-Run Economic Growth

Savings, Investment Spending, and the Financial Syst

Income and Expenditure

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money, Banking, and the Federal Reserve System

Monetary Policy

Inflation, Disinflation, and Deflation

Macroeconomics: Events and Ideas

International Macroeconomics

Filters

A binding minimum wage in a labor market is set _ the equilibrium wage and causes a _ of labor.

The _ interest rate _.