Question 1

The Bureau of Labor Services calculates U-6. This statistic measures the:

Accepted Answer

A)  underuse of labor that includes discouraged workers, marginally attached workers, and underemployed workers. 
B)  use of labor based on various demographics. 
C)  labor force participation rate in a comprehensive way. 
D)  rate of overuse of labor when workers hold multiple jobs. 
A)  underuse of labor that includes discouraged workers, marginally attached workers, and underemployed workers. 
B)  use of labor based on various demographics. 
C)  labor force participation rate in a comprehensive way. 
D)  rate of overuse of labor when workers hold multiple jobs.

Question 2

The costs that arise from the way inflation makes money a less reliable unit of measurement are:

Accepted Answer

A)  shoe-leather costs. 
B)  menu costs. 
C)  unit-of-account costs. 
D)  medium of exchange costs. 
A)  shoe-leather costs. 
B)  menu costs. 
C)  unit-of-account costs. 
D)  medium of exchange costs.

Question 3

Which statement about unemployment is FALSE?

Accepted Answer

A)  Unemployment always falls during recessions. 
B)  Unemployment always falls during expansions. 
C)  There is a strong negative relation between growth in real GDP and changes in unemployment. 
D)  In general, there is a trade-off between inflation and unemployment in the short run. 
A)  Unemployment always falls during recessions. 
B)  Unemployment always falls during expansions. 
C)  There is a strong negative relation between growth in real GDP and changes in unemployment. 
D)  In general, there is a trade-off between inflation and unemployment in the short run.

Question 4

The real interest rate is the nominal interest rate less the rate of inflation.

Accepted Answer

A) True 
 B)False

Question 5

The inflation rate for the current year is the price level in the current year minus the price level in the previous year.

Accepted Answer

A) True 
 B)False

Question 6

A survey reveals that, on a small island, initially 1,000 people have jobs, 200 people are unemployed but are looking for jobs, and 200 people are neither working nor looking for work. Suppose that 100 of the 200 people who weren't looking for work now begin looking for work and that half of the new entrants find a job. The unemployment rate:

Accepted Answer

A)  rises to 19.2%. 
B)  rises to 21.4%. 
C)  rises to 28.6%. 
D)  Nothing happens to the unemployment rate. 
A)  rises to 19.2%. 
B)  rises to 21.4%. 
C)  rises to 28.6%. 
D)  Nothing happens to the unemployment rate.

Question 7

The use of online banking increases the unit-of-account cost of a high inflation rate.

Accepted Answer

A) True 
 B)False

Question 8

If the rate of unemployment is 10% and the labor force is 130 million, the number of unemployed workers is _____million.

Accepted Answer

A)  1.3 
B)  13 
C)  10 
D)  8 
A)  1.3 
B)  13 
C)  10 
D)  8

Question 9

Use the following to answer questions:  
-(Table: Price Levels) Use Table: Price Levels. What is the rate of inflation from 2011 to 2012?

Accepted Answer

A)  0% 
B)  2.9% 
C)  4.5% 
D)  6.4% 
A)  0% 
B)  2.9% 
C)  4.5% 
D)  6.4%

Question 10

Discouraged workers:

Accepted Answer

A)  are getting paid too little. 
B)  do not like their job. 
C)  are working part-time but are looking for a full-time job. 
D)  have given up looking for a job. 
A)  are getting paid too little. 
B)  do not like their job. 
C)  are working part-time but are looking for a full-time job. 
D)  have given up looking for a job.

Question 11

Cyclical unemployment is a result of recessions and economic downturns and is not considered a part of the natural rate of unemployment.

Accepted Answer

A) True 
 B)False

Question 12

Discouraged workers are not working, want to work, but are not actively looking for a job.

Accepted Answer

A) True 
 B)False

Question 13

The unemployment rate equals the number _____ divided by the number _____ times 100.

Accepted Answer

A)  unemployed; employed 
B)  unemployed; in the population 
C)  employed; in the labor force 
D)  unemployed; in the labor force 
A)  unemployed; employed 
B)  unemployed; in the population 
C)  employed; in the labor force 
D)  unemployed; in the labor force

Question 14

If the real interest rate is 4% and the inflation rate is 1%, then the nominal interest rate is 5%.

Accepted Answer

A) True 
 B)False

Question 15

The natural rate of unemployment is:

Accepted Answer

A)  the rate during recessions. 
B)  equal to the sum of frictional and cyclical unemployment. 
C)  equal to the sum of frictional and structural unemployment. 
D)  cyclical unemployment less frictional unemployment. 
A)  the rate during recessions. 
B)  equal to the sum of frictional and cyclical unemployment. 
C)  equal to the sum of frictional and structural unemployment. 
D)  cyclical unemployment less frictional unemployment.

Question 16

Menu costs refer to the increased cost of:

Accepted Answer

A)  food in a time of inflation. 
B)  eating out when inflation increases. 
C)  changing listed prices. 
D)  the minimum wage. 
A)  food in a time of inflation. 
B)  eating out when inflation increases. 
C)  changing listed prices. 
D)  the minimum wage.

Question 17

If more women enter or reenter the labor force, the natural rate of unemployment is likely to:

Accepted Answer

A)  decrease. 
B)  remain unchanged. 
C)  increase. 
D)  decrease if they are well educated. 
A)  decrease. 
B)  remain unchanged. 
C)  increase. 
D)  decrease if they are well educated.

Question 18

Internet employment agencies have simplified the job search for the applicants. They have also led to a(n) _____ unemployment.

Accepted Answer

A)  increase in frictional 
B)  increase in cyclical 
C)  decrease in frictional 
D)  decrease in structural 
A)  increase in frictional 
B)  increase in cyclical 
C)  decrease in frictional 
D)  decrease in structural

Question 19

During periods of high inflation, stores that publish catalogs find it necessary to revise prices and publish new catalogs more frequently than before. This is an example of _____ costs.

Accepted Answer

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

Question 20

Between 1921 and 1923, Germany underwent a period of hyperinflation.

Accepted Answer

A) True 
 B)False

The Bureau of Labor Services calculates U-6. This statistic measures the:

The costs that arise from the way inflation makes money a less reliable unit of measurement are:

Which statement about unemployment is FALSE?

The real interest rate is the nominal interest rate less the rate of inflation.

The inflation rate for the current year is the price level in the current year minus the price level in the previous year.

The use of online banking increases the unit-of-account cost of a high inflation rate.

If the rate of unemployment is 10% and the labor force is 130 million, the number of unemployed workers is _____million.

Use the following to answer questions: -(Table: Price Levels) Use Table: Price Levels. What is the rate of inflation from 2011 to 2012?

Discouraged workers:

Cyclical unemployment is a result of recessions and economic downturns and is not considered a part of the natural rate of unemployment.

Discouraged workers are not working, want to work, but are not actively looking for a job.

The unemployment rate equals the number _ divided by the number _ times 100.

If the real interest rate is 4% and the inflation rate is 1%, then the nominal interest rate is 5%.

The natural rate of unemployment is:

Menu costs refer to the increased cost of:

If more women enter or reenter the labor force, the natural rate of unemployment is likely to:

Internet employment agencies have simplified the job search for the applicants. They have also led to a(n) _____ unemployment.

During periods of high inflation, stores that publish catalogs find it necessary to revise prices and publish new catalogs more frequently than before. This is an example of _____ costs.

Between 1921 and 1923, Germany underwent a period of hyperinflation.

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

The Bureau of Labor Services calculates U-6. This statistic measures the:

The costs that arise from the way inflation makes money a less reliable unit of measurement are:

Which statement about unemployment is FALSE?

The real interest rate is the nominal interest rate less the rate of inflation.

The inflation rate for the current year is the price level in the current year minus the price level in the previous year.

The use of online banking increases the unit-of-account cost of a high inflation rate.

If the rate of unemployment is 10% and the labor force is 130 million, the number of unemployed workers is _____million.

Use the following to answer questions: -(Table: Price Levels) Use Table: Price Levels. What is the rate of inflation from 2011 to 2012?

Discouraged workers:

Cyclical unemployment is a result of recessions and economic downturns and is not considered a part of the natural rate of unemployment.

Discouraged workers are not working, want to work, but are not actively looking for a job.

The unemployment rate equals the number _____ divided by the number _____ times 100.

If the real interest rate is 4% and the inflation rate is 1%, then the nominal interest rate is 5%.

The natural rate of unemployment is:

Menu costs refer to the increased cost of:

If more women enter or reenter the labor force, the natural rate of unemployment is likely to:

Internet employment agencies have simplified the job search for the applicants. They have also led to a(n) _____ unemployment.

During periods of high inflation, stores that publish catalogs find it necessary to revise prices and publish new catalogs more frequently than before. This is an example of _____ costs.

Between 1921 and 1923, Germany underwent a period of hyperinflation.

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

The unemployment rate equals the number _ divided by the number _ times 100.