Exam 5: Monitoring Jobs and Inflation

Using the notation Pt to designate this period's price level and Pt₋₁ to designate last period's price level,the formula for measuring the inflation rate from last period to this period is

An example of the new goods bias in the CPI is the

Mike has just been laid off from his construction job because consumers are not purchasing new homes because of the recession.Mike would be considered to be part of

The unemployment rate measures the percentage of the working-age population who can't find a job.

The percentage of the people of working age who have jobs is called the ________.

Why is unemployment a problem?

Cyclical unemployment exists when

Category Number (millions) Discouraged workers 15 Unemployed workers 40 Employed workers 100 Population (16years and over) 225 -In the above table,the size of the labor force is

The working-age population is defined as the number of

The labor force is defined as the number of

If the inflation rate is negative,the price level in an economy is

Consider the following scenario.Initially the economy has 90 million people working,10 million people unemployed,and 20 million people not in the labor force.Then prospects for the economy improve.Five million people who previously were not in the labor force now join the 10 million previously unemployed in looking for work.For now,the economy remains with 90 million workers.What happens to the unemployment rate?

Item Quantity (2012) Price (2012) Price (2013) Oranges 50 \ 0.90 \ 0.75 Bananas 100 \ 0.50 \ 0.95 Chicken 200 \ 2.00 \ 2.50 Beef 100 \ 5.00 \ 4.80 Bread 300 \ 1.75 \ 2.00 -The table above gives the CPI basket for 2012.Suppose that 2012 is the reference base period. a) What is the cost of the CPI basket in 2012? b) What is the cost of the CPI basket in 2013? c) What is the CPI for 2012? d) What is the CPI for 2013?

How does the unemployment rate change in a recession and in an expansion?

Based on the following data for the country of Tiny Town,the employment-to-population ratio equals ________ multiplied by 100. Population = 200 Working age population = 100 Labor Force = 90 Number of employed persons = 75

Unemployment caused by the normal labor turnover is called ________ unemployment.

If the CPI was 132.5 at the end of last year and 140.2 at the end of this year,the inflation rate over these two years was

In the United States in 1996,the population was 265.5 million and the working age population was 200.6 million.There were 133.9 million people in the labor force and 126.7 of them were employed.The unemployment rate equaled ________.

Give an example of a frictionally unemployed person.

If the population is 300 million,with 70 million under the age of 16 and institutionalized,another 70 million not in the labor force,10 million unemployed and 150 million employed,the unemployment rate is