Question 1

If the number employed is 190 million,the working-age population is 230 million,and the number unemployed is 10 million,then the unemployment rate is

Accepted Answer

A) 5%. 
B) 5.2%. 
C) 8%. 
D) 10%. 
E) 50%. 
A) 5%. 
B) 5.2%. 
C) 8%. 
D) 10%. 
E) 50%.

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

The increased generosity of unemployment insurance programs in Canada as compared to the United States should

Accepted Answer

A) decrease the duration of unemployment in Canada as compared to the United States. 
B) increase the duration of unemployment in Canada as compared to the United States. 
C) have no impact on the duration of unemployment in Canada. 
D) raise the duration of unemployment in the United States. 
A) decrease the duration of unemployment in Canada as compared to the United States. 
B) increase the duration of unemployment in Canada as compared to the United States. 
C) have no impact on the duration of unemployment in Canada. 
D) raise the duration of unemployment in the United States.

Question 4

Since 1948,the labor force participation rate for adult men has ________ and for adult women has ________.

Accepted Answer

A) increased; increased 
B) increased; decreased 
C) decreased; increased 
D) decreased; decreased 
A) increased; increased 
B) increased; decreased 
C) decreased; increased 
D) decreased; decreased

Question 5

Describe the three types of unemployment.

Accepted Answer

Frictional unemployment is short-term un

Question 6

Cyclical 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 7

What is outlet bias?

Accepted Answer

A) the tendency for households to spend more money over time 
B) the tendency for households to spend their money at discount stores as prices rise 
C) the tendency for the quality of products to improve over time even though the CPI does not measure changes in quality 
D) the tendency for consumers to purchase newer,more technologically advanced products even though they have higher prices 
A) the tendency for households to spend more money over time 
B) the tendency for households to spend their money at discount stores as prices rise 
C) the tendency for the quality of products to improve over time even though the CPI does not measure changes in quality 
D) the tendency for consumers to purchase newer,more technologically advanced products even though they have higher prices

Question 8

Between 2017 and 2018,the CPI of a small nation rose from 182 to 185.If household incomes rose by 3% during that period of time,which of the following is true?

Accepted Answer

A) The purchasing power of household income rose between 2017 and 2018. 
B) The purchasing power of household income fell between 2017 and 2018. 
C) The purchasing power of household income remained constant between 2017 and 2018. 
D) The CPI cannot be used to determine how the purchasing power of household income changes over time. 
A) The purchasing power of household income rose between 2017 and 2018. 
B) The purchasing power of household income fell between 2017 and 2018. 
C) The purchasing power of household income remained constant between 2017 and 2018. 
D) The CPI cannot be used to determine how the purchasing power of household income changes over time.

Question 9

Which of the following would reduce the labor force participation rate,all else equal?

Accepted Answer

A) an increase in the number of people in the labor force 
B) an increase in the unemployment rate 
C) a decrease in the unemployment rate 
D) an increase in the working-age population 
A) an increase in the number of people in the labor force 
B) an increase in the unemployment rate 
C) a decrease in the unemployment rate 
D) an increase in the working-age population

Question 10

The stated interest rate on a loan is the

Accepted Answer

A) real interest rate. 
B) nominal interest rate. 
C) actual inflation rate. 
D) expected inflation rate. 
A) real interest rate. 
B) nominal interest rate. 
C) actual inflation rate. 
D) expected inflation rate.

Question 11

Which of the following describes a situation in which the person is hurt by inflation?

Accepted Answer

A) a retiree whose pension is adjusted for inflation 
B) a person who borrows money during a period when inflation is under-predicted 
C) a person who lends money during a period when inflation is over-predicted 
D) a person paid a fixed income during an inflationary period 
A) a retiree whose pension is adjusted for inflation 
B) a person who borrows money during a period when inflation is under-predicted 
C) a person who lends money during a period when inflation is over-predicted 
D) a person paid a fixed income during an inflationary period

Question 12

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 13

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

Accepted Answer

A) the unemployment rate rose. 
B) the labor force participation rate fell. 
C) the unemployment rate fell. 
D) the labor force participation rate rose. 
A) the unemployment rate rose. 
B) the labor force participation rate fell. 
C) the unemployment rate fell. 
D) the labor force participation rate rose.

Question 14

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

Accepted Answer

A) postpone purchases while they waited for prices to fall even lower; increased the burden on borrowers 
B) demand higher wages in anticipation of prices eventually rising again; increased manufacturing since firms could afford to hire more labor 
C) borrow more money since money was now cheap; reduced the amount of money consumers would have to pay back on their outstanding loans 
D) increase purchases to take advantage of the falling prices; increased the burden on lenders 
A) postpone purchases while they waited for prices to fall even lower; increased the burden on borrowers 
B) demand higher wages in anticipation of prices eventually rising again; increased manufacturing since firms could afford to hire more labor 
C) borrow more money since money was now cheap; reduced the amount of money consumers would have to pay back on their outstanding loans 
D) increase purchases to take advantage of the falling prices; increased the burden on lenders

Question 15

The formula for calculating the CPI is

Accepted Answer

A) (Expenditures in the current year/Expenditures in the base year)× 100. 
B) (Expenditures in the current year × Expenditures in the base year)/100. 
C) (Expenditures in the base year/Expenditures in the current year). 
D) (Expenditures in the base year × 100)/(Expenditures in the current year). 
A) (Expenditures in the current year/Expenditures in the base year)× 100. 
B) (Expenditures in the current year × Expenditures in the base year)/100. 
C) (Expenditures in the base year/Expenditures in the current year). 
D) (Expenditures in the base year × 100)/(Expenditures in the current year).

Question 16

If inflation is unanticipated,no redistribution of income can occur.

Accepted Answer

A) True 
 B)False

Question 17

The problem associated with inflation is that as prices rise,consumers can no longer afford to buy as many goods and services,since nominal income usually does not increase with inflation.

Accepted Answer

A) True 
 B)False

Question 18

The real interest rate equals the nominal 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 19

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.

Accepted Answer

A) True 
 B)False

Question 20

The Bureau of Labor Statistics counts as employed people who work part-time,but would prefer to work full-time.Suppose the people who had part-time jobs,but wanted full-time jobs,were counted as unemployed.Explain how the unemployment rate and the labor force participation rate would change.

Accepted Answer

The unemployment rate would increase and

If the number employed is 190 million,the working-age population is 230 million,and the number unemployed is 10 million,then the unemployment rate is

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

The increased generosity of unemployment insurance programs in Canada as compared to the United States should

Since 1948,the labor force participation rate for adult men has and for adult women has .

Describe the three types of unemployment.

Cyclical unemployment is the result of

What is outlet bias?

Between 2017 and 2018,the CPI of a small nation rose from 182 to 185.If household incomes rose by 3% during that period of time,which of the following is true?

Which of the following would reduce the labor force participation rate,all else equal?

The stated interest rate on a loan is the

Which of the following describes a situation in which the person is hurt by inflation?

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

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

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

The formula for calculating the CPI is

If inflation is unanticipated,no redistribution of income can occur.

The problem associated with inflation is that as prices rise,consumers can no longer afford to buy as many goods and services,since nominal income usually does not increase with inflation.

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

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.

The Bureau of Labor Statistics counts as employed people who work part-time,but would prefer to work full-time.Suppose the people who had part-time jobs,but wanted full-time jobs,were counted as unemployed.Explain how the unemployment rate and the labor force participation rate would change.

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

Exam 9: Unemployment and Inflation

If the number employed is 190 million,the working-age population is 230 million,and the number unemployed is 10 million,then the unemployment rate is

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

The increased generosity of unemployment insurance programs in Canada as compared to the United States should

Since 1948,the labor force participation rate for adult men has ________ and for adult women has ________.

Describe the three types of unemployment.

Cyclical unemployment is the result of

What is outlet bias?

Between 2017 and 2018,the CPI of a small nation rose from 182 to 185.If household incomes rose by 3% during that period of time,which of the following is true?

Which of the following would reduce the labor force participation rate,all else equal?

The stated interest rate on a loan is the

Which of the following describes a situation in which the person is hurt by inflation?

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

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

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

The formula for calculating the CPI is

If inflation is unanticipated,no redistribution of income can occur.

The problem associated with inflation is that as prices rise,consumers can no longer afford to buy as many goods and services,since nominal income usually does not increase with inflation.

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

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.

The Bureau of Labor Statistics counts as employed people who work part-time,but would prefer to work full-time.Suppose the people who had part-time jobs,but wanted full-time jobs,were counted as unemployed.Explain how the unemployment rate and the labor force participation rate would change.

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

Since 1948,the labor force participation rate for adult men has and for adult women has .

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