Question 1

The biggest problem caused by a deflation is that

Accepted Answer

A)  prices fall. 
B)  wages fall. 
C)  people cannot repay their debts. 
D)  interest rates rise. 
A)  prices fall. 
B)  wages fall. 
C)  people cannot repay their debts. 
D)  interest rates rise.

Question 2

Recall the Application about the study done about the perceptions and behavior of the unemployed in Great Britain to answer the following question(s).
-According to this Application, the more unhappy unemployed individuals were,

Accepted Answer

A)  the more likely they were to remain unemployed. 
B)  the more aggressive they would be to try to find a job. 
C)  the more they congregated around others who were unemployed. 
D)  the longer they collected unemployment benefits. 
A)  the more likely they were to remain unemployed. 
B)  the more aggressive they would be to try to find a job. 
C)  the more they congregated around others who were unemployed. 
D)  the longer they collected unemployment benefits.

Question 3

The typical relationship between inflation and unemployment is

Accepted Answer

A)  as unemployment falls, inflation falls. 
B)  as unemployment falls, inflation increases. 
C)  as unemployment falls, nothing happens to inflation. 
D)  unemployment changes do not directly lead to changes in inflation, but inflation changes may cause changes in unemployment. 
A)  as unemployment falls, inflation falls. 
B)  as unemployment falls, inflation increases. 
C)  as unemployment falls, nothing happens to inflation. 
D)  unemployment changes do not directly lead to changes in inflation, but inflation changes may cause changes in unemployment.

Question 4

Recall the Application about the study done about the perceptions and behavior of the unemployed in Great Britain to answer the following question(s).
-According to this Application, becoming unemployed caused ________ in perceived well-being for men if those in their peer group were also unemployed.

Accepted Answer

A)  a larger decrease 
B)  a smaller decrease 
C)  no change 
D)  an large increase 
A)  a larger decrease 
B)  a smaller decrease 
C)  no change 
D)  an large increase

Question 5

Explain why deflation could prevent people from being able to repay their debts.

Accepted Answer

When an economy experiences deflation, o

Question 6

Why is the line between frictional and structural unemployment sometimes hard to draw?

Accepted Answer

Suppose a highly skilled steel worker is

Question 7

The costs of inflation that arise from trying to reduce cash holdings are known as

Accepted Answer

A)  shoe leather costs. 
B)  menu costs. 
C)  chain-index costs. 
D)  diminishing costs. 
A)  shoe leather costs. 
B)  menu costs. 
C)  chain-index costs. 
D)  diminishing costs.

Question 8

Inflation distorts the operation of our tax and financial system.

Accepted Answer

A) True 
 B)False

Question 9

Table 6.1
Employment status of the working age
population of Metropolis is approximately:
  
-Given the data in Table 6.1, if the workers who are "not employed and not looking for work" were counted as not employed and in the labor force, the unemployment rate of Metropolis would be approximately

Accepted Answer

A)  4 percent. 
B)  7 percent. 
C)  9 percent. 
D)  10 percent. 
A)  4 percent. 
B)  7 percent. 
C)  9 percent. 
D)  10 percent.

Question 10

What is cyclical unemployment?

Accepted Answer

Cyclical unemploymen

Question 11

An economic ________ refers to either an upturn or a downturn in the economy.

Accepted Answer

A)  stagnation 
B)  model 
C)  fluctuation 
D)  chain index 
A)  stagnation 
B)  model 
C)  fluctuation 
D)  chain index

Question 12

People who are only working part-time, but want to be working full-time, are classified officially as

Accepted Answer

A)  unemployed and in the labor force. 
B)  unemployed and out of the labor force. 
C)  employed and in the labor force. 
D)  employed and out of the labor force. 
A)  unemployed and in the labor force. 
B)  unemployed and out of the labor force. 
C)  employed and in the labor force. 
D)  employed and out of the labor force.

Question 13

The natural rate of unemployment

Accepted Answer

A)  can vary over time and will differ across countries. 
B)  can vary over time but tends to be the same across countries. 
C)  tends to remain constant over time but at different levels for different countries. 
D)  tends to remain constant over time and is the same across countries. 
A)  can vary over time and will differ across countries. 
B)  can vary over time but tends to be the same across countries. 
C)  tends to remain constant over time but at different levels for different countries. 
D)  tends to remain constant over time and is the same across countries.

Question 14

What does the Consumer Price Index (CPI)measure?

Accepted Answer

A)  prices of durable goods 
B)  prices of non durable goods 
C)  the cost of living over time 
D)  the cost of replacing lost items 
A)  prices of durable goods 
B)  prices of non durable goods 
C)  the cost of living over time 
D)  the cost of replacing lost items

Question 15

Anticipated inflation is associated with cost increases which are fully expected.

Accepted Answer

A) True 
 B)False

Question 16

Economists define the unemployed as individuals who are

Accepted Answer

A)  not currently working. 
B)  not currently working but are actively looking for work. 
C)  working but looking for a different job. 
D)  working less than their desired amount of time. 
A)  not currently working. 
B)  not currently working but are actively looking for work. 
C)  working but looking for a different job. 
D)  working less than their desired amount of time.

Question 17

Cost-of-living adjustments are

Accepted Answer

A)  automatic wage changes based on the CPI which are included in some union contracts. 
B)  changes in the basket of goods used in calculating the CPI. 
C)  averages of neighboring years' base prices used in constructing the CPI. 
D)  quality measurements included in the calculation of the CPI. 
A)  automatic wage changes based on the CPI which are included in some union contracts. 
B)  changes in the basket of goods used in calculating the CPI. 
C)  averages of neighboring years' base prices used in constructing the CPI. 
D)  quality measurements included in the calculation of the CPI.

Question 18

Economists believe that the CPI overstates actual price changes by as much as ________ to ________ percent each year.

Accepted Answer

A)  1; 2 
B)  2; 3 
C)  0.5; 1 
D)  0.5; 1.5 
A)  1; 2 
B)  2; 3 
C)  0.5; 1 
D)  0.5; 1.5

Question 19

How costly are biases in the CPI?

Accepted Answer

Each year the federal government increas

Question 20

Hector voluntarily left his job to search for a job in accounting, the field in which he has his bachelor's degree. Hector is considered

Accepted Answer

A)  structurally unemployed. 
B)  cyclically unemployed. 
C)  frictionally unemployed. 
D)  not to be unemployed. 
A)  structurally unemployed. 
B)  cyclically unemployed. 
C)  frictionally unemployed. 
D)  not to be unemployed.

The biggest problem caused by a deflation is that

Recall the Application about the study done about the perceptions and behavior of the unemployed in Great Britain to answer the following question(s). -According to this Application, the more unhappy unemployed individuals were,

The typical relationship between inflation and unemployment is

Explain why deflation could prevent people from being able to repay their debts.

Why is the line between frictional and structural unemployment sometimes hard to draw?

The costs of inflation that arise from trying to reduce cash holdings are known as

Inflation distorts the operation of our tax and financial system.

Table 6.1 Employment status of the working age population of Metropolis is approximately: -Given the data in Table 6.1, if the workers who are "not employed and not looking for work" were counted as not employed and in the labor force, the unemployment rate of Metropolis would be approximately

What is cyclical unemployment?

An economic ________ refers to either an upturn or a downturn in the economy.

People who are only working part-time, but want to be working full-time, are classified officially as

The natural rate of unemployment

What does the Consumer Price Index (CPI)measure?

Anticipated inflation is associated with cost increases which are fully expected.

Economists define the unemployed as individuals who are

Cost-of-living adjustments are

Economists believe that the CPI overstates actual price changes by as much as to percent each year.

How costly are biases in the CPI?

Hector voluntarily left his job to search for a job in accounting, the field in which he has his bachelor's degree. Hector is considered

Introduction: What Is Economics?

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Measuring a Nation's 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

The biggest problem caused by a deflation is that

Recall the Application about the study done about the perceptions and behavior of the unemployed in Great Britain to answer the following question(s). -According to this Application, the more unhappy unemployed individuals were,

The typical relationship between inflation and unemployment is

Explain why deflation could prevent people from being able to repay their debts.

Why is the line between frictional and structural unemployment sometimes hard to draw?

The costs of inflation that arise from trying to reduce cash holdings are known as

Inflation distorts the operation of our tax and financial system.

Table 6.1 Employment status of the working age population of Metropolis is approximately: -Given the data in Table 6.1, if the workers who are "not employed and not looking for work" were counted as not employed and in the labor force, the unemployment rate of Metropolis would be approximately

What is cyclical unemployment?

An economic ________ refers to either an upturn or a downturn in the economy.

People who are only working part-time, but want to be working full-time, are classified officially as

The natural rate of unemployment

What does the Consumer Price Index (CPI)measure?

Anticipated inflation is associated with cost increases which are fully expected.

Economists define the unemployed as individuals who are

Cost-of-living adjustments are

Economists believe that the CPI overstates actual price changes by as much as ________ to ________ percent each year.

How costly are biases in the CPI?

Hector voluntarily left his job to search for a job in accounting, the field in which he has his bachelor's degree. Hector is considered

Introduction: What Is Economics?

The Key Principles of Economics

Exchange and Markets

Demand, Supply, and Market Equilibrium

Measuring a Nation's 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

Economists believe that the CPI overstates actual price changes by as much as to percent each year.