Question 1

If inflationary expectations are increasing,we would expect that the nominal interest rate would also be increasing,holding all else constant.

Accepted Answer

A) True 
 B)False  True

Question 2

List three different price indices and explain how they differ in terms of the market basket on which they are based.

Accepted Answer

Three examples of price indices are the GDP deflator,the consumer price index,and the producer price index.All three differ by the kinds of goods that are contained in the market basket that is used to calculate the average level of prices.The GDP deflator is based on the average price of all final goods and services produced.The consumer price index is based on the average price of 211 goods/services purchased by the typical urban family of four.The producer price index is based on the prices received by producers of goods and services at all stages of the production process.

Question 3

A full-time student who is not working is categorized as

Accepted Answer

A) unemployed. 
B) employed. 
C) not in the labor force. 
D) a discouraged worker. 
E) frictionally unemployed. 
A) unemployed. 
B) employed. 
C) not in the labor force. 
D) a discouraged worker. 
E) frictionally unemployed. C

Question 4

Cyclical unemployment is the result of

Accepted Answer

A) a persistent mismatch between the skills and characteristics of workers and the requirements of the jobs. 
B) the search process of matching workers with jobs. 
C) the ups and downs in inflation. 
D) a slowdown in the economy. 
A) a persistent mismatch between the skills and characteristics of workers and the requirements of the jobs. 
B) the search process of matching workers with jobs. 
C) the ups and downs in inflation. 
D) a slowdown in the economy.

Question 5

Table 13-2
 $$\begin{array}{c}
 \quad \quad \quad\text { Base Year (2006) } \quad \quad 2013\
\begin{array} { | l | c | c | c | } 
\hline \text { Product } & \text { Quantity } & \text { Price } & \text { Price } \
\hline \text { Milk } & 50 & \$ 1.20 & \$ 1.50 \
\hline \text { Bread } & 100 & 1.00 & 1.10 \
\hline
\end{array}
\end{array}$$
-Refer to Table 13-2.Assume the market basket for the consumer price index has two products - bread and milk - with the following values in 2006 and 2013 for price and quantity: The Consumer Price Index for 2013 equals

Accepted Answer

A) 118. 
B) 116. 
C) 86. 
D) 85. 
A) 118. 
B) 116. 
C) 86. 
D) 85.

Question 6

Figure 13-1
  
-Refer to Figure 13-1.Based on the graph of the labor market above,if a minimum wage of $8 per hour is imposed,which of the following will result?

Accepted Answer

A) The quantity of labor demanded by firms will rise. 
B) The quantity of labor demanded by firms will fall. 
C) The unemployment rate will fall. 
D) Both A and C will occur. 
A) The quantity of labor demanded by firms will rise. 
B) The quantity of labor demanded by firms will fall. 
C) The unemployment rate will fall. 
D) Both A and C will occur.

Question 7

Which of the following price indices comes closest to measuring the cost of living of the typical household?

Accepted Answer

A) GDP deflator 
B) producer price index 
C) consumer price index 
D) household price index 
A) GDP deflator 
B) producer price index 
C) consumer price index 
D) household price index

Question 8

If the BLS counted persons that are on active military service in the totals for employment,the labor force,or the working-age population,this would

Accepted Answer

A) decrease the measured unemployment rate. 
B) decrease the measured labor force participation rate. 
C) decrease the number of persons in the labor force. 
D) decrease the number of persons in the working-age population. 
A) decrease the measured unemployment rate. 
B) decrease the measured labor force participation rate. 
C) decrease the number of persons in the labor force. 
D) decrease the number of persons in the working-age population.

Question 9

Discouraged workers are

Accepted Answer

A) workers who have a part time job but want a full time job. 
B) workers who find their current jobs unfulfilling and are considering a job change. 
C) workers who have consistently been looking for work for more than 4 weeks. 
D) workers who have stopped looking for work because they believe there are no jobs for them. 
A) workers who have a part time job but want a full time job. 
B) workers who find their current jobs unfulfilling and are considering a job change. 
C) workers who have consistently been looking for work for more than 4 weeks. 
D) workers who have stopped looking for work because they believe there are no jobs for them.

Question 10

Since 1948,the labor force participation rate for adult men has ________ and for adult women has ________.

Accepted Answer

A) increased; increased 
B) increased; decreased 
C) decreased; increased 
D) decreased; decreased 
A) increased; increased 
B) increased; decreased 
C) decreased; increased 
D) decreased; decreased

Question 11

The cost to firms of changing prices

Accepted Answer

A) is small even when there is rapid inflation. 
B) is called a menu cost. 
C) does not exist if inflation is perfectly anticipated. 
D) all of the above 
A) is small even when there is rapid inflation. 
B) is called a menu cost. 
C) does not exist if inflation is perfectly anticipated. 
D) all of the above

Question 12

If inflation is positive and is perfectly anticipated

Accepted Answer

A) those that borrow money lose. 
B) those that lend money lose. 
C) those that hold paper money lose. 
D) no one in the economy loses. 
A) those that borrow money lose. 
B) those that lend money lose. 
C) those that hold paper money lose. 
D) no one in the economy loses.

Question 13

Table 13-1
 $$\begin{array} { | l | r| } 
\hline \text { Total population } & 20,000 \
\hline \text { Working-age population } & 15,000 \
\hline \text { Employment } & 1,000 \
\hline \text { Unemployment } & 100 \
\hline
\end{array}$$ 
Consider the data above for a simple economy.
-Refer to Table 13-1.The unemployment rate for this simple economy equals

Accepted Answer

A) (100/1,000)× 100. 
B) (100/1,100)× 100. 
C) (100/15,000)× 100. 
D) (100/20,000)× 100. 
A) (100/1,000)× 100. 
B) (100/1,100)× 100. 
C) (100/15,000)× 100. 
D) (100/20,000)× 100.

Question 14

Following the recession of 2007-2009,the employment-population ratio

Accepted Answer

A) remained virtually unchanged for the next 36 months. 
B) was even lower four years after the end of the recession. 
C) began to slowly increase back to its pre-recession level. 
D) began to quickly increase back to its pre-recession level. 
A) remained virtually unchanged for the next 36 months. 
B) was even lower four years after the end of the recession. 
C) began to slowly increase back to its pre-recession level. 
D) began to quickly increase back to its pre-recession level.

Question 15

Which of the following would reduce the labor force participation rate,all else equal?

Accepted Answer

A) an increase in the number of people in the labor force 
B) an increase in the unemployment rate 
C) a decrease in the unemployment rate 
D) an increase in the working-age population 
A) an increase in the number of people in the labor force 
B) an increase in the unemployment rate 
C) a decrease in the unemployment rate 
D) an increase in the working-age population

Question 16

If the nominal interest rate is 6% and the inflation rate is 9%,then the real interest rate is

Accepted Answer

A) -3%. 
B) 3%. 
C) 6.67%. 
D) 15%. 
A) -3%. 
B) 3%. 
C) 6.67%. 
D) 15%.

Question 17

The natural rate of unemployment is made up of

Accepted Answer

A) frictional, cyclical, and structural unemployment. 
B) frictional and cyclical unemployment. 
C) cyclical and structural unemployment. 
D) frictional and structural unemployment. 
E) seasonal and structural unemployment. 
A) frictional, cyclical, and structural unemployment. 
B) frictional and cyclical unemployment. 
C) cyclical and structural unemployment. 
D) frictional and structural unemployment. 
E) seasonal and structural unemployment.

Question 18

The unemployment rate equals the number of unemployed divided by the ________,all times 100.

Accepted Answer

A) number of employed 
B) labor force 
C) working-age population 
D) total population 
A) number of employed 
B) labor force 
C) working-age population 
D) total population

Question 19

Which of the following is not a cost posed by inflation?

Accepted Answer

A) Inflation reduces the affordability of goods and services to the average consumer. 
B) The money that consumers and firms hold loses its purchasing power. 
C) Firms must pay for changing prices on products and printing new catalogs. 
D) Banks can lose if they under predict inflation and charge an interest rate that does not completely compensate for inflation. 
A) Inflation reduces the affordability of goods and services to the average consumer. 
B) The money that consumers and firms hold loses its purchasing power. 
C) Firms must pay for changing prices on products and printing new catalogs. 
D) Banks can lose if they under predict inflation and charge an interest rate that does not completely compensate for inflation.

Question 20

To understand why someone cannot get a job,it helps to know the three types of unemployment.List the three types of unemployment and explain what causes each type.What advice for finding a job would be appropriate for someone in each type of unemployment?

Accepted Answer

Frictional unemployment is the unemploym

If inflationary expectations are increasing,we would expect that the nominal interest rate would also be increasing,holding all else constant.

List three different price indices and explain how they differ in terms of the market basket on which they are based.

A full-time student who is not working is categorized as

Cyclical unemployment is the result of

Figure 13-1 -Refer to Figure 13-1.Based on the graph of the labor market above,if a minimum wage of $8 per hour is imposed,which of the following will result?

Which of the following price indices comes closest to measuring the cost of living of the typical household?

If the BLS counted persons that are on active military service in the totals for employment,the labor force,or the working-age population,this would

Discouraged workers are

Since 1948,the labor force participation rate for adult men has and for adult women has .

The cost to firms of changing prices

If inflation is positive and is perfectly anticipated

Table 13-1 Total population 20,000 Working-age population 15,000 Employment 1,000 Unemployment 100 Consider the data above for a simple economy. -Refer to Table 13-1.The unemployment rate for this simple economy equals

Following the recession of 2007-2009,the employment-population ratio

Which of the following would reduce the labor force participation rate,all else equal?

If the nominal interest rate is 6% and the inflation rate is 9%,then the real interest rate is

The natural rate of unemployment is made up of

The unemployment rate equals the number of unemployed divided by the ________,all times 100.

Which of the following is not a cost posed by inflation?

To understand why someone cannot get a job,it helps to know the three types of unemployment.List the three types of unemployment and explain what causes each type.What advice for finding a job would be appropriate for someone in each type of unemployment?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 13: Unemployment and Inflation

If inflationary expectations are increasing,we would expect that the nominal interest rate would also be increasing,holding all else constant.

List three different price indices and explain how they differ in terms of the market basket on which they are based.

A full-time student who is not working is categorized as

Cyclical unemployment is the result of

Figure 13-1 -Refer to Figure 13-1.Based on the graph of the labor market above,if a minimum wage of $8 per hour is imposed,which of the following will result?

Which of the following price indices comes closest to measuring the cost of living of the typical household?

If the BLS counted persons that are on active military service in the totals for employment,the labor force,or the working-age population,this would

Discouraged workers are

Since 1948,the labor force participation rate for adult men has ________ and for adult women has ________.

The cost to firms of changing prices

If inflation is positive and is perfectly anticipated

Table 13-1 Total population 20,000 Working-age population 15,000 Employment 1,000 Unemployment 100 Consider the data above for a simple economy. -Refer to Table 13-1.The unemployment rate for this simple economy equals

Following the recession of 2007-2009,the employment-population ratio

Which of the following would reduce the labor force participation rate,all else equal?

If the nominal interest rate is 6% and the inflation rate is 9%,then the real interest rate is

The natural rate of unemployment is made up of

The unemployment rate equals the number of unemployed divided by the ________,all times 100.

Which of the following is not a cost posed by inflation?

To understand why someone cannot get a job,it helps to know the three types of unemployment.List the three types of unemployment and explain what causes each type.What advice for finding a job would be appropriate for someone in each type of unemployment?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Since 1948,the labor force participation rate for adult men has and for adult women has .