Question 1

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 2

Suppose that at the beginning of a loan contract,the real interest rate is 4% and expected inflation is currently 6%.If actual inflation turns out to be 7% over the loan contract period,then

Accepted Answer

A)  borrowers gain 1% of the loan value. 
B)  lenders gain 1% of the loan value. 
C)  borrowers lose 3% of the loan value. 
D)  lenders gain 3% of the loan value. 
A)  borrowers gain 1% of the loan value. 
B)  lenders gain 1% of the loan value. 
C)  borrowers lose 3% of the loan value. 
D)  lenders gain 3% of the loan value.

Question 3

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

Accepted Answer

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

Question 4

If the CPI changes from 125 to 120 between 2017 and 2018,how did prices change between 2017 and 2018?

Accepted Answer

A)  Prices increased by 5%. 
B)  Prices decreased by 5% 
C)  Prices increased by 25%. 
D)  Prices decreased by 4%. 
A)  Prices increased by 5%. 
B)  Prices decreased by 5% 
C)  Prices increased by 25%. 
D)  Prices decreased by 4%.

Question 5

An efficiency wage

Accepted Answer

A)  is higher than the market wage and tends to increase productivity. 
B)  is lower than the market wage and tends to increase productivity. 
C)  is higher than the market wage and tends to decrease productivity. 
D)  is lower than the market wage and tends to decrease productivity. 
A)  is higher than the market wage and tends to increase productivity. 
B)  is lower than the market wage and tends to increase productivity. 
C)  is higher than the market wage and tends to decrease productivity. 
D)  is lower than the market wage and tends to decrease productivity.

Question 6

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 7

Explain what economists mean by full employment and why this rate of unemployment is not zero.

Accepted Answer

Full employment occurs in the macro econ

Question 8

The labor force participation rates of men have gradually increased since 1948.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following explains the changes in the U.S.adult male labor force participation rate since 1948?

Accepted Answer

A)  More men are joining the military as compared to the past. 
B)  More men are retiring later in life as compared to the past. 
C)  Fewer men consider themselves discouraged workers as compared to the past. 
D)  Younger men are remaining in school longer as compared to the past. 
A)  More men are joining the military as compared to the past. 
B)  More men are retiring later in life as compared to the past. 
C)  Fewer men consider themselves discouraged workers as compared to the past. 
D)  Younger men are remaining in school longer as compared to the past.

Question 10

Discouraged workers are classified by the BLS as

Accepted Answer

A)  part of the labor force. 
B)  not in the labor force. 
C)  unemployed. 
D)  employed. 
E)  part-time employees. 
A)  part of the labor force. 
B)  not in the labor force. 
C)  unemployed. 
D)  employed. 
E)  part-time employees.

Question 11

Efficiency wage is another name for the minimum wage.

Accepted Answer

A) True 
 B)False

Question 12

The natural rate of unemployment consists of frictional unemployment plus structural unemployment.

Accepted Answer

A) True 
 B)False

Question 13

Most of the unemployment that occurred during the Great Depression was

Accepted Answer

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

Question 14

The consumer price index implicitly assumes that the demand curve for each good and service in the representative market basket is

Accepted Answer

A)  positively sloped. 
B)  negatively sloped. 
C)  vertical. 
D)  horizontal. 
A)  positively sloped. 
B)  negatively sloped. 
C)  vertical. 
D)  horizontal.

Question 15

The unemployment rate is

Accepted Answer

A)  the percentage of the labor force that is employed. 
B)  the percentage of the number employed that is unemployed. 
C)  the percentage of the working-age population that is unemployed. 
D)  the percentage of the labor force that is unemployed. 
E)  the percentage of the working-age population that is employed. 
A)  the percentage of the labor force that is employed. 
B)  the percentage of the number employed that is unemployed. 
C)  the percentage of the working-age population that is unemployed. 
D)  the percentage of the labor force that is unemployed. 
E)  the percentage of the working-age population that is employed.

Question 16

Housing is the largest component of the U.S.CPI market basket.

Accepted Answer

A) True 
 B)False

Question 17

If your nominal wage rises more slowly than the price level,we can say your real wage has ________ and the purchasing power of a dollar has ________.

Accepted Answer

A)  fallen; fallen 
B)  fallen; risen 
C)  risen; risen 
D)  risen; fallen 
A)  fallen; fallen 
B)  fallen; risen 
C)  risen; risen 
D)  risen; fallen

Question 18

You borrow $10,000 from a bank for one year at a nominal interest rate of 5%.If inflation over the year is 2%,what is the real interest rate you are paying?

Accepted Answer

A)  2% 
B)  2.5% 
C)  3% 
D)  5% 
A)  2% 
B)  2.5% 
C)  3% 
D)  5%

Question 19

Which of the following would decrease the unemployment rate?

Accepted Answer

A)  an increase in the minimum wage 
B)  an increase in the efficiency wage 
C)  an increase in labor union membership 
D)  government aid to retrain unemployed workers 
A)  an increase in the minimum wage 
B)  an increase in the efficiency wage 
C)  an increase in labor union membership 
D)  government aid to retrain unemployed workers

Question 20

The labor force participation rates of women have rapidly increased since 1948.

Accepted Answer

A) True 
 B)False

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

Suppose that at the beginning of a loan contract,the real interest rate is 4% and expected inflation is currently 6%.If actual inflation turns out to be 7% over the loan contract period,then

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 labor force participation rate for this simple economy equals

If the CPI changes from 125 to 120 between 2017 and 2018,how did prices change between 2017 and 2018?

An efficiency wage

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

Explain what economists mean by full employment and why this rate of unemployment is not zero.

The labor force participation rates of men have gradually increased since 1948.

Which of the following explains the changes in the U.S.adult male labor force participation rate since 1948?

Discouraged workers are classified by the BLS as

Efficiency wage is another name for the minimum wage.

The natural rate of unemployment consists of frictional unemployment plus structural unemployment.

Most of the unemployment that occurred during the Great Depression was

The consumer price index implicitly assumes that the demand curve for each good and service in the representative market basket is

The unemployment rate is

Housing is the largest component of the U.S.CPI market basket.

If your nominal wage rises more slowly than the price level,we can say your real wage has and the purchasing power of a dollar has .

You borrow $10,000 from a bank for one year at a nominal interest rate of 5%.If inflation over the year is 2%,what is the real interest rate you are paying?

Which of the following would decrease the unemployment rate?

The labor force participation rates of women have rapidly increased since 1948.

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

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

Suppose that at the beginning of a loan contract,the real interest rate is 4% and expected inflation is currently 6%.If actual inflation turns out to be 7% over the loan contract period,then

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 labor force participation rate for this simple economy equals

If the CPI changes from 125 to 120 between 2017 and 2018,how did prices change between 2017 and 2018?

An efficiency wage

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

Explain what economists mean by full employment and why this rate of unemployment is not zero.

The labor force participation rates of men have gradually increased since 1948.

Which of the following explains the changes in the U.S.adult male labor force participation rate since 1948?

Discouraged workers are classified by the BLS as

Efficiency wage is another name for the minimum wage.

The natural rate of unemployment consists of frictional unemployment plus structural unemployment.

Most of the unemployment that occurred during the Great Depression was

The consumer price index implicitly assumes that the demand curve for each good and service in the representative market basket is

The unemployment rate is

Housing is the largest component of the U.S.CPI market basket.

If your nominal wage rises more slowly than the price level,we can say your real wage has ________ and the purchasing power of a dollar has ________.

You borrow $10,000 from a bank for one year at a nominal interest rate of 5%.If inflation over the year is 2%,what is the real interest rate you are paying?

Which of the following would decrease the unemployment rate?

The labor force participation rates of women have rapidly increased since 1948.

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

If your nominal wage rises more slowly than the price level,we can say your real wage has and the purchasing power of a dollar has .