Question 1

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 2

Table 9-6
  
-Refer to Table 9-6.Consider the following values of the consumer price index for 1996,1997,and 1998: The inflation rate for 1997 was equal to

Accepted Answer

A) 1.2 percent. 
B) 2.0 percent. 
C) 2.5 percent. 
D) 4.0 percent. 
A) 1.2 percent. 
B) 2.0 percent. 
C) 2.5 percent. 
D) 4.0 percent.

Question 3

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 4

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 5

Table 9-21
   Source: Energy Information Administration
-Refer to Table 9-21.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.

Accepted Answer

Real gasoline price in 1982-1984 dollars

Question 6

Currently,the base year for the CPI is the average of prices in the years 1982 to 1984.

Accepted Answer

A) True 
 B)False

Question 7

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 8

People who lost their jobs as hand-drawn animators because of the popularity of computer-generated 3D animation are examples of persons who are suffering

Accepted Answer

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

Question 9

The natural rate of unemployment is the amount of unemployment

Accepted Answer

A) associated with the business cycle. 
B) equal to frictional plus structural unemployment. 
C) that exists when the economy goes into recession. 
D) that exists when the economy is in an expansion. 
A) associated with the business cycle. 
B) equal to frictional plus structural unemployment. 
C) that exists when the economy goes into recession. 
D) that exists when the economy is in an expansion.

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

If the number of unemployed workers is 19 million,the number in the working-age population is 500 million,and the unemployment rate is 4%,what is the labor force participation rate?

Accepted Answer

A) 4.75% 
B) 7.8% 
C) 95% 
D) 96.2% 
A) 4.75% 
B) 7.8% 
C) 95% 
D) 96.2%

Question 12

When deflation occurs

Accepted Answer

A) the real interest rate is greater than the nominal interest rate. 
B) the nominal interest rate is greater than the real interest rate. 
C) the nominal interest rate is equal to the real interest rate and inflation is negative. 
D) the nominal interest rate is equal to the real interest rate and inflation is positive. 
A) the real interest rate is greater than the nominal interest rate. 
B) the nominal interest rate is greater than the real interest rate. 
C) the nominal interest rate is equal to the real interest rate and inflation is negative. 
D) the nominal interest rate is equal to the real interest rate and inflation is positive.

Question 13

The producer price index tracks the prices firms receive for goods and services at all stages of production.

Accepted Answer

A) True 
 B)False

Question 14

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 15

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 16

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 17

An increase in cyclical unemployment will result in

Accepted Answer

A) an increase in the natural rate of unemployment. 
B) an increase in the unemployment rate. 
C) an increase in structural unemployment. 
D) a decrease in frictional unemployment. 
A) an increase in the natural rate of unemployment. 
B) an increase in the unemployment rate. 
C) an increase in structural unemployment. 
D) a decrease in frictional unemployment.

Question 18

You lend $5,000 to a friend for one year at a nominal interest rate of 10%.The CPI over that year rises from 180 to 190.What is the real rate of interest you will earn?

Accepted Answer

A) 0% 
B) 4.4% 
C) 5.5% 
D) 5.8% 
A) 0% 
B) 4.4% 
C) 5.5% 
D) 5.8%

Question 19

Eliminating structural unemployment would be good for the economy.

Accepted Answer

A) True 
 B)False

Question 20

Jack just received a promotion at work and now works 50 hours per week instead of 35.As a result,

Accepted Answer

A) the unemployment rate increased. 
B) the unemployment rate decreased. 
C) the labor force participation rate increased. 
D) neither the unemployment rate nor the labor force participation rate changed. 
A) the unemployment rate increased. 
B) the unemployment rate decreased. 
C) the labor force participation rate increased. 
D) neither the unemployment rate nor the labor force participation rate changed.

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

Table 9-6 -Refer to Table 9-6.Consider the following values of the consumer price index for 1996,1997,and 1998: The inflation rate for 1997 was equal to

The cost to firms of changing prices

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

Currently,the base year for the CPI is the average of prices in the years 1982 to 1984.

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?

People who lost their jobs as hand-drawn animators because of the popularity of computer-generated 3D animation are examples of persons who are suffering

The natural rate of unemployment is the amount of unemployment

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

If the number of unemployed workers is 19 million,the number in the working-age population is 500 million,and the unemployment rate is 4%,what is the labor force participation rate?

When deflation occurs

The producer price index tracks the prices firms receive for goods and services at all stages of production.

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

An efficiency wage

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

An increase in cyclical unemployment will result in

You lend $5,000 to a friend for one year at a nominal interest rate of 10%.The CPI over that year rises from 180 to 190.What is the real rate of interest you will earn?

Eliminating structural unemployment would be good for the economy.

Jack just received a promotion at work and now works 50 hours per week instead of 35.As a result,

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Economic Efficiency, Government Price Setting, and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

GDP: Measuring Total Production and Income

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

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Exam 9: Unemployment and Inflation

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

Table 9-6 -Refer to Table 9-6.Consider the following values of the consumer price index for 1996,1997,and 1998: The inflation rate for 1997 was equal to

The cost to firms of changing prices

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

Currently,the base year for the CPI is the average of prices in the years 1982 to 1984.

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?

People who lost their jobs as hand-drawn animators because of the popularity of computer-generated 3D animation are examples of persons who are suffering

The natural rate of unemployment is the amount of unemployment

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

If the number of unemployed workers is 19 million,the number in the working-age population is 500 million,and the unemployment rate is 4%,what is the labor force participation rate?

When deflation occurs

The producer price index tracks the prices firms receive for goods and services at all stages of production.

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

An efficiency wage

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

An increase in cyclical unemployment will result in

You lend $5,000 to a friend for one year at a nominal interest rate of 10%.The CPI over that year rises from 180 to 190.What is the real rate of interest you will earn?

Eliminating structural unemployment would be good for the economy.

Jack just received a promotion at work and now works 50 hours per week instead of 35.As a result,

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Economic Efficiency, Government Price Setting, and Taxes

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

GDP: Measuring Total Production and Income

Economic Growth, the Financial System, and Business Cycles

Long-Run Economic Growth: Sources and Policies

Aggregate Expenditure and Output in the Short Run

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Inflation, Unemployment, and Federal Reserve Policy

Macroeconomics in an Open Economy

The International Financial System

Filters