Question 1

People who do not work because of physical disability are officially classified as: ​

Accepted Answer

A)  ​in the labor force. 
B)  ​unemployed. 
C)   not in the labor force. 
D)  ​discouraged worker. 
A)  ​in the labor force. 
B)  ​unemployed. 
C)   not in the labor force. 
D)  ​discouraged worker.

Question 2

Which of the following is associated with peaks in the business cycle?

Accepted Answer

A)  ​Relatively high levels of unemployment. 
B)  ​Recessions. 
C)  ​Relatively low levels of unemployment. 
D)  ​Both answers a. and b. above are correct.​ 
A)  ​Relatively high levels of unemployment. 
B)  ​Recessions. 
C)  ​Relatively low levels of unemployment. 
D)  ​Both answers a. and b. above are correct.​

Question 3

Structural unemployment refers to unemployment resulting from:

Accepted Answer

A)  technological change. 
B)  being in the wrong geographical location 
C)  taking the time to find the best job. 
D)  seasonal decreases in demand for labor. 
E)  a recession in the economy. 
A)  technological change. 
B)  being in the wrong geographical location 
C)  taking the time to find the best job. 
D)  seasonal decreases in demand for labor. 
E)  a recession in the economy.

Question 4

As a general rule, a recession occurs when there is a six consecutive month fall in:

Accepted Answer

A)  nominal GDP. 
B)  real GDP. 
C)  the price level. 
D)  the trade balance. 
A)  nominal GDP. 
B)  real GDP. 
C)  the price level. 
D)  the trade balance.

Question 5

Economists use the phrase "business cycle" when referring to fluctuations in:

Accepted Answer

A)  real GDP. 
B)  the chain price index. 
C)  the consumer price index. 
D)  the general level of prices. 
A)  real GDP. 
B)  the chain price index. 
C)  the consumer price index. 
D)  the general level of prices.

Question 6

Economists usually use the term "recession" to refer to:

Accepted Answer

A)  any slowdown in the growth of real GDP. 
B)  zero real GDP growth. 
C)  two or more consecutive quarters of declining real GDP. 
D)  a reduction in nominal GDP lasting more than six months. 
A)  any slowdown in the growth of real GDP. 
B)  zero real GDP growth. 
C)  two or more consecutive quarters of declining real GDP. 
D)  a reduction in nominal GDP lasting more than six months.

Question 7

Cyclical unemployment refers to unemployment resulting from:

Accepted Answer

A)  a mismatch of skills. 
B)  being in the wrong geographical location. 
C)  the time and monetary cost of finding the best job. 
D)  a recession. 
A)  a mismatch of skills. 
B)  being in the wrong geographical location. 
C)  the time and monetary cost of finding the best job. 
D)  a recession.

Question 8

Exhibit 12-1  Business cycle   In Exhibit 12-1, the recession phase of the business cycle can be represented by point(s):

Accepted Answer

A)  CDE. 
B)  BCD. 
C)  EFG. 
D)  A and E. 
A)  CDE. 
B)  BCD. 
C)  EFG. 
D)  A and E.

Question 9

As a general rule, a recession is a decline in real GDP lasting at least :

Accepted Answer

A)  one year. 
B)  six months. 
C)  three months. 
D)  one month. 
A)  one year. 
B)  six months. 
C)  three months. 
D)  one month.

Question 10

The civilian labor force excludes anyone not actively seeking a job.

Accepted Answer

A) True 
 B)False

Question 11

Cyclical unemployment is primarily caused by:

Accepted Answer

A)  a large proportion of youthful workers in the labor force. 
B)  fluctuations in aggregate demand. 
C)  a lack of training on the part of job seekers. 
D)  the failure of job seekers to search adequately for the available jobs. 
A)  a large proportion of youthful workers in the labor force. 
B)  fluctuations in aggregate demand. 
C)  a lack of training on the part of job seekers. 
D)  the failure of job seekers to search adequately for the available jobs.

Question 12

Cyclical unemployment:

Accepted Answer

A)  causes unemployment statistics to be understated. 
B)  causes unemployment statistics to be overstated. 
C)  occurs because of recessions. 
D)  occurs because of technological innovations in production. 
E)  only occurs with a zero inflation rate. 
A)  causes unemployment statistics to be understated. 
B)  causes unemployment statistics to be overstated. 
C)  occurs because of recessions. 
D)  occurs because of technological innovations in production. 
E)  only occurs with a zero inflation rate.

Question 13

Structural unemployment refers to short periods of unemployment needed to match jobs and job seekers.

Accepted Answer

A) True 
 B)False

Question 14

A principal cause of the business cycle is the changes in total spending that occur in the overall economy.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following offers an example of structural unemployment?

Accepted Answer

A)  The rise in unemployment for stable workers after the development of gasoline-powered automobiles and the resulting long-term decline in horse-and- buggy transportation. 
B)  The rise in unemployment among farm workers after harvest. 
C)  The unemployment associated with workers changing jobs. 
D)  The increase in unemployment during recessions. 
A)  The rise in unemployment for stable workers after the development of gasoline-powered automobiles and the resulting long-term decline in horse-and- buggy transportation. 
B)  The rise in unemployment among farm workers after harvest. 
C)  The unemployment associated with workers changing jobs. 
D)  The increase in unemployment during recessions.

Question 16

The business cycle is the periodic but recurrent fluctuations in real GDP.

Accepted Answer

A) True 
 B)False

Question 17

The GDP gap is the difference between:

Accepted Answer

A)  frictional unemployment and actual real GDP. 
B)  unemployment rate and real GDP deflator. 
C)  actual real GDP and full-employment real GDP . 
D)  full-employment real GDP and real GDP deflator. 
A)  frictional unemployment and actual real GDP. 
B)  unemployment rate and real GDP deflator. 
C)  actual real GDP and full-employment real GDP . 
D)  full-employment real GDP and real GDP deflator.

Question 18

The civilian labor force consists of:

Accepted Answer

A)  all civilians over the age of 16. 
B)  the employed plus the unemployed who are not in the military. 
C)  only individuals who are actually at work during a given week. 
D)  civilians who are not in prisons or mental hospitals. 
A)  all civilians over the age of 16. 
B)  the employed plus the unemployed who are not in the military. 
C)  only individuals who are actually at work during a given week. 
D)  civilians who are not in prisons or mental hospitals.

Question 19

Find the BLS's rate of unemployment from the following data: frictional unemployment = 150, structural unemployment = 200, cyclical unemployment = 225, discouraged workers = 25, underemployed workers = 75, fully employed workers = 850, total population = 2,000.

Accepted Answer

A)  17.5 percent 
B)  23.3 percent 
C)  24.6 percent 
D)  28.8 percent 
E)  38.3 percent 
A)  17.5 percent 
B)  23.3 percent 
C)  24.6 percent 
D)  28.8 percent 
E)  38.3 percent

Question 20

Sharon was being treated unfairly by her boss, so she stormed off the job and two days later found another position. For two days, Sharon experienced:

Accepted Answer

A)  cyclical unemployment. 
B)  structural unemployment. 
C)  seasonal unemployment. 
D)  frictional unemployment. 
E)  being out of the labor force. 
A)  cyclical unemployment. 
B)  structural unemployment. 
C)  seasonal unemployment. 
D)  frictional unemployment. 
E)  being out of the labor force.

Exam 12: Business Cycles and Unemployment

People who do not work because of physical disability are officially classified as: ​

Which of the following is associated with peaks in the business cycle?

Structural unemployment refers to unemployment resulting from:

As a general rule, a recession occurs when there is a six consecutive month fall in:

Economists use the phrase "business cycle" when referring to fluctuations in:

Economists usually use the term "recession" to refer to:

Cyclical unemployment refers to unemployment resulting from:

Exhibit 12-1 Business cycle In Exhibit 12-1, the recession phase of the business cycle can be represented by point(s):

As a general rule, a recession is a decline in real GDP lasting at least :

The civilian labor force excludes anyone not actively seeking a job.

Cyclical unemployment is primarily caused by:

Cyclical unemployment:

Structural unemployment refers to short periods of unemployment needed to match jobs and job seekers.

A principal cause of the business cycle is the changes in total spending that occur in the overall economy.

Which of the following offers an example of structural unemployment?

The business cycle is the periodic but recurrent fluctuations in real GDP.

The GDP gap is the difference between:

The civilian labor force consists of:

Find the BLS's rate of unemployment from the following data: frictional unemployment = 150, structural unemployment = 200, cyclical unemployment = 225, discouraged workers = 25, underemployed workers = 75, fully employed workers = 850, total population = 2,000.

Sharon was being treated unfairly by her boss, so she stormed off the job and two days later found another position. For two days, Sharon experienced:

Introducing the Economic Way of Thinking

Production Possibilities, Opportunity Cost, and Economic Growth

Market Demand and Supply

Markets in Action

Price Elasticity of Demand

Production Costs

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets and Income Distribution

Gross Domestic Product

Inflation

Aggregate Demand and Supply

Fiscal Policy

The Public Sector

Federal Deficits, Surpluses, and the National Debt

Money and the Federal Reserve System

Money Creation

Policy Disputes Using the Self-Correcting Aggregate Demand and Supply Model

International Trade and Finance

Economies in Transition

Growth and the Less-Developed Countries

Filters

People who do not work because of physical disability are officially classified as: