Exam 13: Unemployment and Inflation

Which of the following explains why many European countries have unemployment rates that are higher than in the United States?

Table 13-12 Product Quantity Base Year Price (2001) Price(2017) Price (2018) Burritos 10 \ 1.00 \ 1.50 \ 1.75 Flashlights 15 5.00 7.00 6.75 Golf balls 8 2.00 3.00 3.50 -Refer to Table 13-12.Consider a simple economy that produces only three products: burritos,flashlights,and golf balls.Use the information in the table to calculate the inflation rate for 2018,as measured by the consumer price index.

Table 13-23 Year Nominal Minimum Wage CPI (1982-1984=100) 1974 \ 2.00 49.3 2017 7.25 244.3 -Refer to Table 13-23.The table above lists the actual minimum wage and CPI in 1974 and in 2017.Using the above table,calculate the real minimum wage for 1974 and 2017.Calculate the rate of growth of the real minimum wage from 1974 to 2017.Are workers better off in terms of the purchasing power of a dollar in 1974 or 2017? Explain why.

Which of the following is an example of a worker experiencing frictional unemployment?

The CPI in 2010 was 218,while the CPI in 1980 was 82.If you had $5,000 in 1980,its equivalent purchasing power in 2010 would be $10,850.

During the month of May,10 million workers moved from being classified as "unemployed" to being classified as "employed." As a result

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

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?

Frictional unemployment is the result of

The deflation of the 1930s impacted the U.S.economy because it led some consumers to ________ and because it ________.

Fill in the missing values in the table of data collected in the household survey for November,2009.The working-age population,employment,unemployment,and labor force are measured in thousands.Show your work. Working-age population 235,900 Employment Unemployment Unemployment rate 9.4\% Labor force Labor force participation rate 65.5\%

Assume the average annual CPI values for 2017 and 2018 were 207.3 and 215.3,respectively.What was the percent increase in the CPI between these two years?

If the CPI rises from 206.7 to 212.7 between two consecutive years,by how much has the cost of living changed between these two years?

During a deflationary period

Your grandfather tells you that he earned $7,000/year in his first job in 1961.You earn $35,000/year in your first job in 2018.You know that average prices have risen steadily since 1961.You earn

Unemployment caused by a business cycle recession is called cyclical unemployment.

Eliminating frictional unemployment would be good for the economy.

Using a broader measure of the unemployment rate where discouraged workers and part-time workers who wished to work full time were counted as unemployed,the BLS estimates the unemployment rate in April 2017 would have ________ compared to the measured unemployment rate.

Table 13-21 Average Retail Price Unleaded Regular Gasoline CPI Year Month (centsper gallon) (1982-1984=100) 1976 June 59.2 56.8 1981 September 137.6 93.2 1994 December 114.3 149.7 2011 October 340.0 226.9 Source: Energy Information Administration -Refer to Table 13-21.The table above reports the consumer price index and the average U.S.retail price for unleaded regular gasoline for four different periods since 1976.Note that the gasoline prices are in cents per gallon. Calculate the real average retail price of unleaded regular gasoline in 1982-1984 dollars.In which period were gasoline prices the highest in real terms? Also,calculate the real average retail price of unleaded regular gasoline in 2011 dollars.

Describe the three types of unemployment.