Question 1

What are the three main types of unemployment?

Accepted Answer

A)  frictional, seasonal, and cyclical 
B)  temporary, permanent, and volunteer 
C)  cyclical, structural, and temporary 
D)  structural, frictional, and cyclical 
A)  frictional, seasonal, and cyclical 
B)  temporary, permanent, and volunteer 
C)  cyclical, structural, and temporary 
D)  structural, frictional, and cyclical

Question 2

Most economists believe that labor unions significantly increase the overall unemployment rate in the United States.

Accepted Answer

A) True 
 B)False

Question 3

The nominal interest rate equals the real interest rate ________ the inflation rate.

Accepted Answer

A)  times 
B)  divided by 
C)  plus 
D)  minus 
A)  times 
B)  divided by 
C)  plus 
D)  minus

Question 4

Which of the following would increase the unemployment rate?

Accepted Answer

A)  a law making it illegal to work more than 35 hours per week 
B)  a cut in unemployment compensation 
C)  an increase in unemployment insurance payments 
D)  a decrease in the minimum wage 
A)  a law making it illegal to work more than 35 hours per week 
B)  a cut in unemployment compensation 
C)  an increase in unemployment insurance payments 
D)  a decrease in the minimum wage

Question 5

Except for recessions,the duration of unemployment for the typical person lasts

Accepted Answer

A)  less than six months. 
B)  six to nine months. 
C)  over nine months. 
D)  over one year. 
E)  over five years. 
A)  less than six months. 
B)  six to nine months. 
C)  over nine months. 
D)  over one year. 
E)  over five years.

Question 6

You borrow $10,000 from a bank for one year at a nominal interest rate of 5%.The CPI over that year rises from 180 to 200.What is the real interest rate you are paying?

Accepted Answer

A)  15% 
B)  5% 
C)  -1.1% 
D)  -6.1% 
A)  15% 
B)  5% 
C)  -1.1% 
D)  -6.1%

Question 7

Table 13-13
 $\begin{array}{|l|c|c|c|c|}
\hline \text { Product } & \text { Quantity } & \begin{array}{c}
\text { Base Year } \
\text { Price (2001) }
\end{array} & \text { Price(2017) } & \text { Price (2018) } \
\hline \text { Tacos } & 5 & \$ 1.50 & \$ 2.00 & \$ 2.25 \
\hline \text { Earplugs } & 10 & 6.00 & 7.50 & 7.00 \
\hline \text { Toothbrushes } & 3 & 2.50 & 3.50 & 3.50 \
\hline
\end{array}$
-Refer to Table 13-13.Consider a simple economy that produces only three products: tacos,earplugs,and toothbrushes.Use the information in the table to calculate the inflation rate for 2018,as measured by the consumer price index.

Accepted Answer

Total expenditures for 2001 = (5 × $1.50

Question 8

If inflation 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

Question 9

Which of the following statements is true about the U.S.economy?

Accepted Answer

A)  Each year, many new jobs are created, but few existing jobs are destroyed, and the unemployed find jobs quickly. 
B)  Each year, few new jobs are created, but few existing jobs are destroyed, keeping unemployment low. 
C)  Each year, many new jobs are created and many existing jobs are destroyed. 
D)  Each year few jobs are created, and therefore it takes the unemployed a long time to find a new job. 
A)  Each year, many new jobs are created, but few existing jobs are destroyed, and the unemployed find jobs quickly. 
B)  Each year, few new jobs are created, but few existing jobs are destroyed, keeping unemployment low. 
C)  Each year, many new jobs are created and many existing jobs are destroyed. 
D)  Each year few jobs are created, and therefore it takes the unemployed a long time to find a new job.

Question 10

Which of the following cause the unemployment rate as measured by the Bureau of Labor Statistics to understate the true extent of joblessness?

Accepted Answer

A)  inflation 
B)  discouraged workers 
C)  people employed in the underground economy 
D)  unemployed persons falsely report themselves to be actively looking for a job 
A)  inflation 
B)  discouraged workers 
C)  people employed in the underground economy 
D)  unemployed persons falsely report themselves to be actively looking for a job

Question 11

Suppose 180,000 people are employed,20,000 people are unemployed,the working-age population is 250,000,and 50,000 people are not in the labor force.Calculate the unemployment rate.

Accepted Answer

The unemployment rate is calculated as:

Question 12

A student who just graduated from college but has not found a job would most likely be

Accepted Answer

A)  frictionally unemployed. 
B)  structurally unemployed. 
C)  cyclically unemployed. 
D)  seasonally unemployed. 
A)  frictionally unemployed. 
B)  structurally unemployed. 
C)  cyclically unemployed. 
D)  seasonally unemployed.

Question 13

If the employment-population ratio in 2017 was at the same level as it was in 2006

Accepted Answer

A)  the same number of people would have been working in 2017 as were working in 2006. 
B)  3.5 million fewer people would have been working in 2017 than actually were. 
C)  an additional 8 million people would have been working in 2017 than actually were. 
D)  the number of employed people in 2017 would not have been different. 
A)  the same number of people would have been working in 2017 as were working in 2006. 
B)  3.5 million fewer people would have been working in 2017 than actually were. 
C)  an additional 8 million people would have been working in 2017 than actually were. 
D)  the number of employed people in 2017 would not have been different.

Question 14

Which of the following describes the accuracy of the Consumer Price Index?

Accepted Answer

A)  Changes in the CPI accurately reflect the true rate of inflation. 
B)  Changes in the CPI understate the true rate of inflation. 
C)  Changes in the CPI overstate the true rate of inflation. 
D)  Changes in the CPI are unrelated to the true rate of inflation. 
A)  Changes in the CPI accurately reflect the true rate of inflation. 
B)  Changes in the CPI understate the true rate of inflation. 
C)  Changes in the CPI overstate the true rate of inflation. 
D)  Changes in the CPI are unrelated to the true rate of inflation.

Question 15

Describe how inflation can be costly even if it is anticipated.

Accepted Answer

First,there will be redistribution as so

Question 16

If the number employed is 190 million,the number unemployed is 10 million,and the working-age population is 250 million,then the labor force participation rate is

Accepted Answer

A)  4%. 
B)  5.2%. 
C)  60%. 
D)  76%. 
E)  80%. 
A)  4%. 
B)  5.2%. 
C)  60%. 
D)  76%. 
E)  80%.

Question 17

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.

Question 18

Nominal income is equal to real income if the CPI is less than 100.

Accepted Answer

A) True 
 B)False

Question 19

Structural 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 20

Table 13-14
 $\begin{array}{|c|c|c|}
\hline \text { Year } & \begin{array}{c}
\text { Nominal Average } \
\text { Hourly Earnings }
\end{array} & \begin{array}{c}
\text { CPI (1982-1984 = } \
\mathbf{1 0 0})
\end{array} \
\hline 1965 & \$ 2.65 & 32 \
\hline 2010 & 22.59 & 219 \
\hline
\end{array}$ The table above reports the nominal average hourly earnings in private industry and the consumer price index for 1965 and 2010.
-Refer to Table 13-14.The real average hourly earnings for 1965 in 2010 dollars equal

Accepted Answer

A)  $3.87. 
B)  $5.80. 
C)  $12.10. 
D)  $18.14. 
A)  $3.87. 
B)  $5.80. 
C)  $12.10. 
D)  $18.14.

What are the three main types of unemployment?

Most economists believe that labor unions significantly increase the overall unemployment rate in the United States.

The nominal interest rate equals the real interest rate ________ the inflation rate.

Which of the following would increase the unemployment rate?

Except for recessions,the duration of unemployment for the typical person lasts

You borrow $10,000 from a bank for one year at a nominal interest rate of 5%.The CPI over that year rises from 180 to 200.What is the real interest rate you are paying?

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

Which of the following statements is true about the U.S.economy?

Which of the following cause the unemployment rate as measured by the Bureau of Labor Statistics to understate the true extent of joblessness?

Suppose 180,000 people are employed,20,000 people are unemployed,the working-age population is 250,000,and 50,000 people are not in the labor force.Calculate the unemployment rate.

A student who just graduated from college but has not found a job would most likely be

If the employment-population ratio in 2017 was at the same level as it was in 2006

Which of the following describes the accuracy of the Consumer Price Index?

Describe how inflation can be costly even if it is anticipated.

If the number employed is 190 million,the number unemployed is 10 million,and the working-age population is 250 million,then the labor force participation rate is

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

Nominal income is equal to real income if the CPI is less than 100.

Structural unemployment is the result of

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

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Exam 13: Unemployment and Inflation

What are the three main types of unemployment?

Most economists believe that labor unions significantly increase the overall unemployment rate in the United States.

The nominal interest rate equals the real interest rate ________ the inflation rate.

Which of the following would increase the unemployment rate?

Except for recessions,the duration of unemployment for the typical person lasts

You borrow $10,000 from a bank for one year at a nominal interest rate of 5%.The CPI over that year rises from 180 to 200.What is the real interest rate you are paying?

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

Which of the following statements is true about the U.S.economy?

Which of the following cause the unemployment rate as measured by the Bureau of Labor Statistics to understate the true extent of joblessness?

Suppose 180,000 people are employed,20,000 people are unemployed,the working-age population is 250,000,and 50,000 people are not in the labor force.Calculate the unemployment rate.

A student who just graduated from college but has not found a job would most likely be

If the employment-population ratio in 2017 was at the same level as it was in 2006

Which of the following describes the accuracy of the Consumer Price Index?

Describe how inflation can be costly even if it is anticipated.

If the number employed is 190 million,the number unemployed is 10 million,and the working-age population is 250 million,then the labor force participation rate is

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

Nominal income is equal to real income if the CPI is less than 100.

Structural unemployment is the result of

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