Question 1

Suppose the working-age population is 220 million, the labor force is 150 million, and the unemployment rate is 10 percent. The number of unemployed people is

Accepted Answer

A)  15 million. 
B)  22 million. 
C)  37 million. 
D)  7 million. 
A)  15 million. 
B)  22 million. 
C)  37 million. 
D)  7 million.

Question 2

During an economic expansion, real GDP ________ and unemployment ________.

Accepted Answer

A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases 
A)  increases; increases 
B)  increases; decreases 
C)  decreases; increases 
D)  decreases; decreases

Question 3

The table below shows the price index for China starting in 2000.
 
Www)econstats.com
Which of the following statements CORRECTLY describes the behavior of prices in China?

Accepted Answer

A)  The cost of the CPI basket decreased in 2002. 
B)  China experienced a high price level and high inflation. 
C)  Inflation reached 73% between the base year and 2001. 
D)  The inflation rate between 2005 and 2006 was 14.4 percent. 
A)  The cost of the CPI basket decreased in 2002. 
B)  China experienced a high price level and high inflation. 
C)  Inflation reached 73% between the base year and 2001. 
D)  The inflation rate between 2005 and 2006 was 14.4 percent.

Question 4

Cyclical unemployment is the result of

Accepted Answer

A)  technological change or foreign competition. 
B)  normal labor market turnover. 
C)  the business cycle. 
D)  irresponsible workers with poor work habits. 
A)  technological change or foreign competition. 
B)  normal labor market turnover. 
C)  the business cycle. 
D)  irresponsible workers with poor work habits.

Question 5

Frictional unemployment includes

Accepted Answer

A)  unemployment caused by normal labor turnover associated with people leaving and entering the labor force. 
B)  unemployment caused by industries moving overseas to better meet foreign competition. 
C)  unemployment caused by a lack of education so that workers do not possess necessary job skills. 
D)  unemployment caused by automation of the work place that displaces unskilled workers. 
A)  unemployment caused by normal labor turnover associated with people leaving and entering the labor force. 
B)  unemployment caused by industries moving overseas to better meet foreign competition. 
C)  unemployment caused by a lack of education so that workers do not possess necessary job skills. 
D)  unemployment caused by automation of the work place that displaces unskilled workers.

Question 6

Suppose there are currently 100 people unemployed, 1500 people employed, 1600 people in the labor force, and 2000 people in the working age population. The unemployment rate equals 100 times

Accepted Answer

A)  100/1500. 
B)  100/1600. 
C)  100/2000. 
D)  1500/2000. 
A)  100/1500. 
B)  100/1600. 
C)  100/2000. 
D)  1500/2000.

Question 7

The percentage of the people of working age who have jobs is called the ________.

Accepted Answer

A)  labor force 
B)  inverse of the unemployment rate 
C)  employment-to-population ratio 
D)  employment-to-working-age-population ratio 
A)  labor force 
B)  inverse of the unemployment rate 
C)  employment-to-population ratio 
D)  employment-to-working-age-population ratio

Question 8

In an economy, 40 million people are employed, 2 million are unemployed, and 8 million are not in the labor force. What is the labor force participation rate?

Accepted Answer

A)  83 percent 
B)  84 percent 
C)  80 percent 
D)  87.5 percent 
A)  83 percent 
B)  84 percent 
C)  80 percent 
D)  87.5 percent

Question 9

Frictional unemployment is the result of

Accepted Answer

A)  technological change or foreign competition. 
B)  normal labor market turnover. 
C)  a slowdown in the rate of economic expansion. 
D)  irresponsible workers with poor work habits. 
A)  technological change or foreign competition. 
B)  normal labor market turnover. 
C)  a slowdown in the rate of economic expansion. 
D)  irresponsible workers with poor work habits.

Question 10

The employment-to-population ratio is

Accepted Answer

A)  67 percent. 
B)  64 percent. 
C)  50 percent. 
D)  62 percent. 
A)  67 percent. 
B)  64 percent. 
C)  50 percent. 
D)  62 percent.

Question 11

When the economy is operating at full employment, the natural unemployment rate consists of only

Accepted Answer

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

Question 12

-In the table above, the number of people officially unemployed is ________.

Accepted Answer

A)  40 million 
B)  6 million 
C)  4 million 
D)  2 million 
A)  40 million 
B)  6 million 
C)  4 million 
D)  2 million

Question 13

The consumer price index (CPI)

Accepted Answer

A)  compares the cost of the typical basket of goods consumed in period 1 to the cost of a basket of goods typically consumed in period 2. 
B)  compares the cost in the current period to the cost in a reference base period of a basket of goods typically consumed in the base period. 
C)  measures the increase in the prices of the goods included in GDP. 
D)  is the ratio of the average price of a typical basket of goods to the cost of producing those goods. 
A)  compares the cost of the typical basket of goods consumed in period 1 to the cost of a basket of goods typically consumed in period 2. 
B)  compares the cost in the current period to the cost in a reference base period of a basket of goods typically consumed in the base period. 
C)  measures the increase in the prices of the goods included in GDP. 
D)  is the ratio of the average price of a typical basket of goods to the cost of producing those goods.

Question 14

When the economy is at full employment the unemployment rate equals the natural unemployment rate.

Accepted Answer

A) True 
 B)False

Question 15

If the economy enters an expansion

Accepted Answer

A)  cyclical unemployment increases. 
B)  structural unemployment increases. 
C)  cyclical unemployment decreases. 
D)  structural unemployment decreases. 
A)  cyclical unemployment increases. 
B)  structural unemployment increases. 
C)  cyclical unemployment decreases. 
D)  structural unemployment decreases.

Question 16

How is the unemployment rate calculated? Include in your answer the process by which the U.S. Census Bureau classifies the data it collects in its Current Population Survey.

Accepted Answer

The U.S. Census Bureau conducts the Curr

Question 17

The commodity substitution bias is that

Accepted Answer

A)  consumers substitute high-quality goods for low-quality goods. 
B)  government spending is a good substitute for investment expenditures. 
C)  national saving and foreign borrowing are interchangeable. 
D)  consumers decrease the quantity they buy of goods whose relative prices rise and increase the quantity of goods whose relative price falls. 
A)  consumers substitute high-quality goods for low-quality goods. 
B)  government spending is a good substitute for investment expenditures. 
C)  national saving and foreign borrowing are interchangeable. 
D)  consumers decrease the quantity they buy of goods whose relative prices rise and increase the quantity of goods whose relative price falls.

Question 18

The natural unemployment rate

Accepted Answer

A)  is a constant figure of about 4 percent. 
B)  fluctuates with the rate of inflation. 
C)  is the unemployment rate that occurs when the economy is at full employment. 
D)  is equal to cyclical unemployment. 
A)  is a constant figure of about 4 percent. 
B)  fluctuates with the rate of inflation. 
C)  is the unemployment rate that occurs when the economy is at full employment. 
D)  is equal to cyclical unemployment.

Question 19

-The CPI basket contains 400 oranges and 800 pens. In the base year, the price of an orange is $1.00 and the price of a pen is $0.75. This year, urban consumers each buy 300 oranges at $2.00 each and 850 pens at $1.00 each. The CPI this year is ________.

Accepted Answer

A)  1.60 
B)  62.5 
C)  160 
D)  140 
A)  1.60 
B)  62.5 
C)  160 
D)  140

Question 20

Suppose the current unemployment rate is 5 percent, the labor force is 400 million people, the labor force participation rate is 80 percent and the working-age population is 500 million people. What number of people are unemployed?

Accepted Answer

The number of unemployed peopl

Suppose the working-age population is 220 million, the labor force is 150 million, and the unemployment rate is 10 percent. The number of unemployed people is

During an economic expansion, real GDP and unemployment .

The table below shows the price index for China starting in 2000. Www)econstats.com Which of the following statements CORRECTLY describes the behavior of prices in China?

Cyclical unemployment is the result of

Frictional unemployment includes

Suppose there are currently 100 people unemployed, 1500 people employed, 1600 people in the labor force, and 2000 people in the working age population. The unemployment rate equals 100 times

The percentage of the people of working age who have jobs is called the ________.

In an economy, 40 million people are employed, 2 million are unemployed, and 8 million are not in the labor force. What is the labor force participation rate?

Frictional unemployment is the result of

The employment-to-population ratio is

When the economy is operating at full employment, the natural unemployment rate consists of only

-In the table above, the number of people officially unemployed is ________.

The consumer price index (CPI)

When the economy is at full employment the unemployment rate equals the natural unemployment rate.

If the economy enters an expansion

How is the unemployment rate calculated? Include in your answer the process by which the U.S. Census Bureau classifies the data it collects in its Current Population Survey.

The commodity substitution bias is that

The natural unemployment rate

-The CPI basket contains 400 oranges and 800 pens. In the base year, the price of an orange is $1.00 and the price of a pen is $0.75. This year, urban consumers each buy 300 oranges at $2.00 each and 850 pens at $1.00 each. The CPI this year is ________.

Suppose the current unemployment rate is 5 percent, the labor force is 400 million people, the labor force participation rate is 80 percent and the working-age population is 500 million people. What number of people are unemployed?

What Is Economics?

The Economic Problem

Demand and Supply

Measuring GDP and Economic Growth

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 5: Monitoring Jobs and Inflation

Suppose the working-age population is 220 million, the labor force is 150 million, and the unemployment rate is 10 percent. The number of unemployed people is

During an economic expansion, real GDP ________ and unemployment ________.

The table below shows the price index for China starting in 2000. Www)econstats.com Which of the following statements CORRECTLY describes the behavior of prices in China?

Cyclical unemployment is the result of

Frictional unemployment includes

Suppose there are currently 100 people unemployed, 1500 people employed, 1600 people in the labor force, and 2000 people in the working age population. The unemployment rate equals 100 times

The percentage of the people of working age who have jobs is called the ________.

In an economy, 40 million people are employed, 2 million are unemployed, and 8 million are not in the labor force. What is the labor force participation rate?

Frictional unemployment is the result of

The employment-to-population ratio is

When the economy is operating at full employment, the natural unemployment rate consists of only

-In the table above, the number of people officially unemployed is ________.

The consumer price index (CPI)

When the economy is at full employment the unemployment rate equals the natural unemployment rate.

If the economy enters an expansion

How is the unemployment rate calculated? Include in your answer the process by which the U.S. Census Bureau classifies the data it collects in its Current Population Survey.

The commodity substitution bias is that

The natural unemployment rate

-The CPI basket contains 400 oranges and 800 pens. In the base year, the price of an orange is $1.00 and the price of a pen is $0.75. This year, urban consumers each buy 300 oranges at $2.00 each and 850 pens at $1.00 each. The CPI this year is ________.

Suppose the current unemployment rate is 5 percent, the labor force is 400 million people, the labor force participation rate is 80 percent and the working-age population is 500 million people. What number of people are unemployed?

What Is Economics?

The Economic Problem

Demand and Supply

Measuring GDP and Economic Growth

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers

The Business Cycle, Inflation, and Deflation

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

During an economic expansion, real GDP and unemployment .