Question 1

One of the following individuals tend to benefit from inflation.

Accepted Answer

A) Retirees 
B) Government employees 
C) Seasoned workers 
D) Homeowners 
A) Retirees 
B) Government employees 
C) Seasoned workers 
D) Homeowners

Question 2

From 1991 to 2007, the rate of inflation in the United States has been

Accepted Answer

A) zero. 
B) between zero and 2.1 percent. 
C) between 1.6 percent and 4.1 percent. 
D) between 3.2 percent and 7.2 percent. 
A) zero. 
B) between zero and 2.1 percent. 
C) between 1.6 percent and 4.1 percent. 
D) between 3.2 percent and 7.2 percent.

Question 3

Which of the following groups would most likely to benefit from inflation?

Accepted Answer

A) Borrowers 
B) Lenders 
C) Creditors 
D) Pensioners 
A) Borrowers 
B) Lenders 
C) Creditors 
D) Pensioners

Question 4

During periods of high inflation, such as the 1979-1980 period, the existence of usury laws may cause

Accepted Answer

A) nominal rates of interest to be above real rates. 
B) negative nominal rates of interest. 
C) negative real rates of interest. 
D) real rates of interest to be above nominal rates. 
A) nominal rates of interest to be above real rates. 
B) negative nominal rates of interest. 
C) negative real rates of interest. 
D) real rates of interest to be above nominal rates.

Question 5

To protect themselves from the effects of inflation, lenders try to estimate the expected rate of inflation.

Accepted Answer

A) True 
 B)False

Question 6

An increase in the capital stock has the same effect on the production function as an increase in

Accepted Answer

A) labor. 
B) output. 
C) GDP. 
D) technology. 
A) labor. 
B) output. 
C) GDP. 
D) technology.

Question 7

If a borrower arbitrarily gains purchasing power as the result of a particular loan agreement, then

Accepted Answer

A) actual inflation was greater than expected inflation. 
B) actual inflation was equal to expected inflation. 
C) actual inflation was less than expected inflation. 
D) the real interest rate was greater than the nominal interest rate. 
A) actual inflation was greater than expected inflation. 
B) actual inflation was equal to expected inflation. 
C) actual inflation was less than expected inflation. 
D) the real interest rate was greater than the nominal interest rate.

Question 8

Unemployment rates differ widely among various groups in the population.

Accepted Answer

A) True 
 B)False

Question 9

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 10

Which of the following would decrease the total output of goods and services?

Accepted Answer

A) Mandatory controls on production 
B) Increases the hours of work 
C) Increases in labor input growth 
D) Increases in capital stock 
A) Mandatory controls on production 
B) Increases the hours of work 
C) Increases in labor input growth 
D) Increases in capital stock

Question 11

Workers in country A receive an increase in wages of 10 percent at the same time the inflation rate in country A is 8 percent.Workers in country B receive an increase in wages of 3 percent and the inflation rate in country B is 1 percent.In which country are workers better off?

Accepted Answer

A) Country A because their real wages rise by 18 percent. 
B) Country A because their real wages rise by 10 percent. 
C) Country B because the inflation rate is lower. 
D) Neither country because the increase in real wages is the same. 
A) Country A because their real wages rise by 18 percent. 
B) Country A because their real wages rise by 10 percent. 
C) Country B because the inflation rate is lower. 
D) Neither country because the increase in real wages is the same.

Question 12

If actual inflation is greater than the expected rate of inflation, then probably

Accepted Answer

A) the borrowers are made better off than lenders. 
B) the borrowers are made worse off than lenders. 
C) creditors gain at the expense of borrowers. 
D) savings accounts have increased in real terms. 
A) the borrowers are made better off than lenders. 
B) the borrowers are made worse off than lenders. 
C) creditors gain at the expense of borrowers. 
D) savings accounts have increased in real terms.

Question 13

Technological change or the effects of automation cause

Accepted Answer

A) structural unemployment. 
B) frictional unemployment. 
C) seasonal unemployment. 
D) cyclical unemployment. 
A) structural unemployment. 
B) frictional unemployment. 
C) seasonal unemployment. 
D) cyclical unemployment.

Question 14

If the capital stock increases, then the economy can produce ____ output with the ____ amount of labor.

Accepted Answer

A) same, same 
B) less, same 
C) more, same 
D) less, less 
A) same, same 
B) less, same 
C) more, same 
D) less, less

Question 15

Studies on fast-food stores in Texas and New Jersey suggest that the federal minimum wage law

Accepted Answer

A) has huge ramifications on unemployment. 
B) does not have a discernable impact on unemployment. 
C) causes unemployment for high skilled workers. 
D) new entrants to the work force search for longer periods. 
A) has huge ramifications on unemployment. 
B) does not have a discernable impact on unemployment. 
C) causes unemployment for high skilled workers. 
D) new entrants to the work force search for longer periods.

Question 16

Economists feel that taxing nominal capital gains imposes costs on the economy due to

Accepted Answer

A) increased consumption. 
B) reduced consumption. 
C) increased investment. 
D) reduced investment. 
A) increased consumption. 
B) reduced consumption. 
C) increased investment. 
D) reduced investment.

Question 17

In 2009, the average unemployment rate in the United States averaged

Accepted Answer

A) 4.6 percent. 
B) 5.4 percent. 
C) 7.2 percent. 
D) 9.3 percent. 
A) 4.6 percent. 
B) 5.4 percent. 
C) 7.2 percent. 
D) 9.3 percent.

Question 18

Labor productivity is calculated by dividing GDP by

Accepted Answer

A) population. 
B) the price level. 
C) capital stock 
D) labor force. 
A) population. 
B) the price level. 
C) capital stock 
D) labor force.

Question 19

Economists generally assume that ____ economic growth is better for society.

Accepted Answer

A) slower 
B) faster 
C) stable 
D) declining 
A) slower 
B) faster 
C) stable 
D) declining

Question 20

If the labor force grows faster than the number employed, the

Accepted Answer

A) unemployment rate will fall. 
B) unemployment rate will rise. 
C) labor force rate will rise. 
D) employment rate will rise. 
A) unemployment rate will fall. 
B) unemployment rate will rise. 
C) labor force rate will rise. 
D) employment rate will rise.

Exam 22: The Goals of Macroeconomic Policy

One of the following individuals tend to benefit from inflation.

From 1991 to 2007, the rate of inflation in the United States has been

Which of the following groups would most likely to benefit from inflation?

During periods of high inflation, such as the 1979-1980 period, the existence of usury laws may cause

To protect themselves from the effects of inflation, lenders try to estimate the expected rate of inflation.

An increase in the capital stock has the same effect on the production function as an increase in

If a borrower arbitrarily gains purchasing power as the result of a particular loan agreement, then

Unemployment rates differ widely among various groups in the population.

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

Which of the following would decrease the total output of goods and services?

Workers in country A receive an increase in wages of 10 percent at the same time the inflation rate in country A is 8 percent.Workers in country B receive an increase in wages of 3 percent and the inflation rate in country B is 1 percent.In which country are workers better off?

If actual inflation is greater than the expected rate of inflation, then probably

Technological change or the effects of automation cause

If the capital stock increases, then the economy can produce ____ output with the ____ amount of labor.

Studies on fast-food stores in Texas and New Jersey suggest that the federal minimum wage law

Economists feel that taxing nominal capital gains imposes costs on the economy due to

In 2009, the average unemployment rate in the United States averaged

Labor productivity is calculated by dividing GDP by

Economists generally assume that ____ economic growth is better for society.

If the labor force grows faster than the number employed, the

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Monopoly

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

The Economics of the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

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

Contemporary Issues in the Useconomy

Filters

If the capital stock increases, then the economy can produce output with the amount of labor.