Question 1

In the United States, the unemployment rate for women is roughly the same as the unemployment rate for men.

Accepted Answer

A) True 
 B)False

Question 2

What generally causes the business cycle? What are the four phases of a single business cycle? What are the problems associated with the business cycle?

Accepted Answer

Changes in total spending (aggregate dem

Question 3

People who are not currently employed, but say they want a job, are counted as unemployed only if they:

Accepted Answer

A)  have previously held a job. 
B)  are actively seeking employment. 
C)  are willing to accept a reasonable offer. 
D)  are between 16 and 65 years of age. 
E)  are willing to accept any offer of employment. 
A)  have previously held a job. 
B)  are actively seeking employment. 
C)  are willing to accept a reasonable offer. 
D)  are between 16 and 65 years of age. 
E)  are willing to accept any offer of employment.

Question 4

The period during which real GDP falls during a business cycle is called:

Accepted Answer

A)  peak. 
B)  recession. 
C)  recovery. 
D)  trough. 
A)  peak. 
B)  recession. 
C)  recovery. 
D)  trough.

Question 5

The unemployment rate equals the number of persons:

Accepted Answer

A)  unemployed divided by the number employed. 
B)  unemployed divided by the number in the civilian labor force. 
C)  unemployed divided by the population age 16 and over. 
D)  not working divided by the population age 16 and over. 
A)  unemployed divided by the number employed. 
B)  unemployed divided by the number in the civilian labor force. 
C)  unemployed divided by the population age 16 and over. 
D)  not working divided by the population age 16 and over.

Question 6

A person who has lost his or her job because it is now performed by a robot is structurally unemployed.

Accepted Answer

A) True 
 B)False

Question 7

If Sam Jackson voluntarily quits one job, possesses marketable skills, and expects to find a new job in a few weeks, then Mr. Jackson is considered:

Accepted Answer

A)  frictionally unemployed. 
B)  cyclically unemployed. 
C)  seasonally unemployed. 
D)  structurally unemployed. 
E)  unwise to quit his job without already having another one. 
A)  frictionally unemployed. 
B)  cyclically unemployed. 
C)  seasonally unemployed. 
D)  structurally unemployed. 
E)  unwise to quit his job without already having another one.

Question 8

Which of the following is true ?

Accepted Answer

A)  Frictional unemployment implies a lack of available jobs. 
B)  During a recession, cyclical unemployment will be low. 
C)  When an economy is at full employment, actual unemployment will be less than the natural rate of unemployment. 
D)  When actual GDP equals potential GDP, the actual unemployment rate will equal the economy's natural rate of unemployment. 
A)  Frictional unemployment implies a lack of available jobs. 
B)  During a recession, cyclical unemployment will be low. 
C)  When an economy is at full employment, actual unemployment will be less than the natural rate of unemployment. 
D)  When actual GDP equals potential GDP, the actual unemployment rate will equal the economy's natural rate of unemployment.

Question 9

The period of growth in real GDP between the trough of the business cycle and the next peak is called the:

Accepted Answer

A)  recessionary phase. 
B)  expansionary phase. 
C)  contractionary phase. 
D)  cyclical phase. 
A)  recessionary phase. 
B)  expansionary phase. 
C)  contractionary phase. 
D)  cyclical phase.

Question 10

Which type of unemployment is most closely connected with the saying "you can't teach an old dog new tricks"?

Accepted Answer

A)  Cyclical. 
B)  Frictional. 
C)  Structural. 
D)  Voluntary. 
E)  Seasonal. 
A)  Cyclical. 
B)  Frictional. 
C)  Structural. 
D)  Voluntary. 
E)  Seasonal.

Question 11

A business cycle is the:

Accepted Answer

A)  period of time in which expansion and contraction of economic activity are equal. 
B)  period of time in which there are three phases: peak, depression, and recovery. 
C)  recurring growth and decline in real GDP. 
D)  period of time in which a business is established and ceases operations. 
A)  period of time in which expansion and contraction of economic activity are equal. 
B)  period of time in which there are three phases: peak, depression, and recovery. 
C)  recurring growth and decline in real GDP. 
D)  period of time in which a business is established and ceases operations.

Question 12

When full employment is present in the United States:

Accepted Answer

A)  the rate of unemployment will fall to zero. 
B)  the actual rate of unemployment will be less than the natural rate of unemployment. 
C)  approximately 95 percent of the adult population will be employed. 
D)  approximately 95 percent of the labor force will be employed. 
A)  the rate of unemployment will fall to zero. 
B)  the actual rate of unemployment will be less than the natural rate of unemployment. 
C)  approximately 95 percent of the adult population will be employed. 
D)  approximately 95 percent of the labor force will be employed.

Question 13

Sam is a musician who is out of work because electronic equipment replaced live musicians. This is an example of:

Accepted Answer

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

Question 14

What stage of the business cycle immediately follows the trough?

Accepted Answer

A)  Peak. 
B)  Recovery. 
C)  Recession. 
D)  Depression. 
A)  Peak. 
B)  Recovery. 
C)  Recession. 
D)  Depression.

Question 15

Industrial production is not a coincident indicator.

Accepted Answer

A) True 
 B)False

Question 16

Cyclical unemployment is caused by:

Accepted Answer

A)  shifts in the job skills required in the economy. 
B)  seasonal layoffs. 
C)  declines in real GDP. 
D)  cyclical changes in the job skills among workers. 
A)  shifts in the job skills required in the economy. 
B)  seasonal layoffs. 
C)  declines in real GDP. 
D)  cyclical changes in the job skills among workers.

Question 17

A criticism of the unemployment rate is that:

Accepted Answer

A)  underemployment is measured in the calculation. 
B)  the data includes part-time workers as fully employed. 
C)  discouraged workers are included in the calculation. 
D)  all of the above are problems. 
A)  underemployment is measured in the calculation. 
B)  the data includes part-time workers as fully employed. 
C)  discouraged workers are included in the calculation. 
D)  all of the above are problems.

Question 18

A general rule is that economy is experiencing a recession when:

Accepted Answer

A)  real GDP declines for at least three months. 
B)  real GDP declines for at least nine months. 
C)  nominal GDP declines for at least nine months. 
D)  real GDP declines for at least six months. 
E)  nominal GDP declines for at least six months. 
A)  real GDP declines for at least three months. 
B)  real GDP declines for at least nine months. 
C)  nominal GDP declines for at least nine months. 
D)  real GDP declines for at least six months. 
E)  nominal GDP declines for at least six months.

Question 19

Lori Field is homemaker. Last week, she was busy with her normal household chores. She is:

Accepted Answer

A)  a member of the civilian labor force who is employed. 
B)  a member of the civilian labor force who is unemployed. 
C)  a member of the civilian labor force who is underemployed. 
D)  a discouraged worker who is not a member of the labor force. 
E)  not a member of the labor force. 
A)  a member of the civilian labor force who is employed. 
B)  a member of the civilian labor force who is unemployed. 
C)  a member of the civilian labor force who is underemployed. 
D)  a discouraged worker who is not a member of the labor force. 
E)  not a member of the labor force.

Question 20

If a sizable number of workers were switched from full-time to half-time employment, then the official unemployment rate would:

Accepted Answer

A)  rise. 
B)  fall. 
C)  remain unchanged. 
D)  react unpredictably. 
A)  rise. 
B)  fall. 
C)  remain unchanged. 
D)  react unpredictably.

Exam 12: Business Cycles and Unemployment

In the United States, the unemployment rate for women is roughly the same as the unemployment rate for men.

What generally causes the business cycle? What are the four phases of a single business cycle? What are the problems associated with the business cycle?

People who are not currently employed, but say they want a job, are counted as unemployed only if they:

The period during which real GDP falls during a business cycle is called:

The unemployment rate equals the number of persons:

A person who has lost his or her job because it is now performed by a robot is structurally unemployed.

If Sam Jackson voluntarily quits one job, possesses marketable skills, and expects to find a new job in a few weeks, then Mr. Jackson is considered:

Which of the following is true ?

The period of growth in real GDP between the trough of the business cycle and the next peak is called the:

Which type of unemployment is most closely connected with the saying "you can't teach an old dog new tricks"?

A business cycle is the:

When full employment is present in the United States:

Sam is a musician who is out of work because electronic equipment replaced live musicians. This is an example of:

What stage of the business cycle immediately follows the trough?

Industrial production is not a coincident indicator.

Cyclical unemployment is caused by:

A criticism of the unemployment rate is that:

A general rule is that economy is experiencing a recession when:

Lori Field is homemaker. Last week, she was busy with her normal household chores. She is:

If a sizable number of workers were switched from full-time to half-time employment, then the official unemployment rate would:

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