Question 1

A __________ is a person who was employed in the civilian labor force and was either fired or laid off.

Accepted Answer

A) new entrant 
B) reentrant 
C) job leaver 
D) job fixer 
E) none of the above 
A) new entrant 
B) reentrant 
C) job leaver 
D) job fixer 
E) none of the above

Question 2

Suppose the civilian non-institutional population equals 100,000 persons;the civilian labor force equals 75,000 persons;there are 70,000 employed persons and 5,000 unemployed persons.If 5,000 persons who are currently "not in the labor force" decide to join the civilian labor force,and 3,000 of them are unemployed,then

Accepted Answer

A) both the unemployment and the employment rate rise. 
B) both the unemployment and the employment rate fall. 
C) the unemployment rate rises and the employment rate falls. 
D) the unemployment rate falls and the employment rate rises. 
A) both the unemployment and the employment rate rise. 
B) both the unemployment and the employment rate fall. 
C) the unemployment rate rises and the employment rate falls. 
D) the unemployment rate falls and the employment rate rises.

Question 3

A market basket is made up of three goods,10X,12Y,and 18Z.The prices in the base year are $1.20,$2.10,and $3.25,respectively.The prices in the current year are $1.44,$2.23,and $3.88.What is the approximate consumer price index in the current year?

Accepted Answer

A) 103 
B) 111 
C) 116 
D) 110 
E) 96 
A) 103 
B) 111 
C) 116 
D) 110 
E) 96

Question 4

At the time of Elise's 20 year high school reunion she was earning $50,000 and the CPI was 80.Now that it is time for her to attend her 25 year high school reunion,Elise's income has risen to $80,000 and the CPI is 150.At her 25 year reunion,can Elise rightfully brag that her real income has risen since the last time she saw her former classmates five years ago?

Accepted Answer

A) Yes,Elise's real income rose during that 5 year period. 
B) No,Elise's real income fell during that 5 year period. 
C) No,Elise's real income remained constant during that 5 year period. 
D) It is impossible to determine what happened to Elise's real income. 
A) Yes,Elise's real income rose during that 5 year period. 
B) No,Elise's real income fell during that 5 year period. 
C) No,Elise's real income remained constant during that 5 year period. 
D) It is impossible to determine what happened to Elise's real income.

Question 5

The number of employed persons plus the number of unemployed persons equals the number of persons

Accepted Answer

A) in the total population. 
B) in the civilian noninstitutional population. 
C) in the civilian labor force. 
D) not in the labor force. 
E) none of the above 
A) in the total population. 
B) in the civilian noninstitutional population. 
C) in the civilian labor force. 
D) not in the labor force. 
E) none of the above

Question 6

Describe the terms frictional unemployment,structural unemployment,and cyclical unemployment.Give a hypothetical example of each to help support your answer.

Accepted Answer

Frictional unemployment is created when

Question 7

Which of the following statements is false?

Accepted Answer

A) The sum of the unemployment rate and the employment rate always equals 100 percent. 
B) The sum of the number of employed persons and the number of unemployed persons equals the civilian non-institutional population. 
C) The labor force participation rate equals the number of persons in the civilian labor force divided by the number of persons in the total population. 
D) a,b,and c 
A) The sum of the unemployment rate and the employment rate always equals 100 percent. 
B) The sum of the number of employed persons and the number of unemployed persons equals the civilian non-institutional population. 
C) The labor force participation rate equals the number of persons in the civilian labor force divided by the number of persons in the total population. 
D) a,b,and c

Question 8

Suppose that 1982 is the base year for the Consumer Price Index (CPI)and in 2014 the CPI was 190.What does this "190" mean?

Accepted Answer

A) What cost $100 in 1982 on average cost 190 times as much in 2014. 
B) What cost $100 in 1982 on average cost $190 in 2014. 
C) What cost $100 in 1982 on average cost 0.19 times as much in 2014 (that is,it cost $19 in 2014). 
D) What cost $100 in 1982 on average cost $19 more in 2014. 
A) What cost $100 in 1982 on average cost 190 times as much in 2014. 
B) What cost $100 in 1982 on average cost $190 in 2014. 
C) What cost $100 in 1982 on average cost 0.19 times as much in 2014 (that is,it cost $19 in 2014). 
D) What cost $100 in 1982 on average cost $19 more in 2014.

Question 9

Smith's income was $50,000 in year 1 and $55,600 in year 2.The CPI was 114 in year 1 and 124 in year 2.What was the approximate percentage change in Smith's real income between the two years?

Accepted Answer

A) -2.2 percent 
B) +3.4 percent 
C) -1.7 percent 
D) +5.6 percent 
E) +2.2 percent 
A) -2.2 percent 
B) +3.4 percent 
C) -1.7 percent 
D) +5.6 percent 
E) +2.2 percent

Question 10

Describe what the term "full employment" means to an economist.

Accepted Answer

Full employment exists when the economy

Question 11

In year 1 the CPI is 140,and in year 2 the CPI is 160.From year 1 to year 2,Chiang's salary rises from $42,000 to $49,000,and Marta's salary rises from $55,000 to $60,000.Who is "more than keeping up with inflation"?

Accepted Answer

A) Marta 
B) Chiang 
C) both Marta and Chiang 
D) neither Marta nor Chiang 
A) Marta 
B) Chiang 
C) both Marta and Chiang 
D) neither Marta nor Chiang

Question 12

In order to be classified as unemployed,a person must be not working,

Accepted Answer

A) have been actively looking for work within the past four weeks,and currently be available for work. 
B) and currently be available for work,regardless of whether one is actively looking for work or not. 
C) and be waiting to be called back to work from a temporary layoff. 
D) and actively looking for work within the past year. 
E) ​a or c 
A) have been actively looking for work within the past four weeks,and currently be available for work. 
B) and currently be available for work,regardless of whether one is actively looking for work or not. 
C) and be waiting to be called back to work from a temporary layoff. 
D) and actively looking for work within the past year. 
E) ​a or c

Question 13

In year 1 the CPI is 181,and in year 2 the CPI is 195.If Dennis's salary was $95,000 in year 1,what is the minimum salary he must earn in year 2 to "keep up with inflation"?

Accepted Answer

A) $112,500 
B) $102,348 
C) $105,750 
D) $88,180 
A) $112,500 
B) $102,348 
C) $105,750 
D) $88,180

Question 14

The unemployment due to changes in the types of skills employers require is called __________ unemployment.

Accepted Answer

A) structural 
B) cyclical 
C) natural 
D) frictional 
A) structural 
B) cyclical 
C) natural 
D) frictional

Question 15

Discouraged workers are not counted as unemployed because they are working.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following statements is true?

Accepted Answer

A) Base year prices are necessarily higher than current year prices. 
B) The CPI in the base year is always 100. 
C) If the CPI is 112 in year 1 and 123 in year 2,prices have risen by approximately 9.8 percent between the two years. 
D) b and c 
E) a,b,and c 
A) Base year prices are necessarily higher than current year prices. 
B) The CPI in the base year is always 100. 
C) If the CPI is 112 in year 1 and 123 in year 2,prices have risen by approximately 9.8 percent between the two years. 
D) b and c 
E) a,b,and c

Question 17

In an economy with 100 million people,70 million hold civilian jobs and 19 million are not working but are looking for jobs.The unemployment rate is

Accepted Answer

A) 12.86% 
B) 21.35%. 
C) 9.19%. 
D) 27.14%. 
E) 2.87% 
A) 12.86% 
B) 21.35%. 
C) 9.19%. 
D) 27.14%. 
E) 2.87%

Question 18

In an economy with a population of 100 million persons,50 million hold civilian jobs and 20 million are not working but are looking for a job.The number of persons in the civilian labor force is

Accepted Answer

A) 50 million. 
B) 70 million. 
C) 170 million. 
D) 180 million.. 
A) 50 million. 
B) 70 million. 
C) 170 million. 
D) 180 million..

Question 19

If the unemployment rate drops,then it necessarily follows that some of the people who were once unemployed are now employed.

Accepted Answer

A) True 
 B)False

Question 20

In year 1 the CPI is 180,and in year 2 the CPI is 192.From year 1 to year 2,Javier's salary rises from $40,000 to $42,000,and Tom's salary rises from $55,000 to $57,000.Who is "more than keeping up with inflation"?

Accepted Answer

A) Javier 
B) Tom 
C) both Tom and Javier 
D) neither Tom nor Javier 
A) Javier 
B) Tom 
C) both Tom and Javier 
D) neither Tom nor Javier

Exam 6: Macroeconomic Measurements, part I: Prices and Unemployment

A __________ is a person who was employed in the civilian labor force and was either fired or laid off.

A market basket is made up of three goods,10X,12Y,and 18Z.The prices in the base year are $1.20,$2.10,and $3.25,respectively.The prices in the current year are $1.44,$2.23,and $3.88.What is the approximate consumer price index in the current year?

The number of employed persons plus the number of unemployed persons equals the number of persons

Describe the terms frictional unemployment,structural unemployment,and cyclical unemployment.Give a hypothetical example of each to help support your answer.

Which of the following statements is false?

Suppose that 1982 is the base year for the Consumer Price Index (CPI)and in 2014 the CPI was 190.What does this "190" mean?

Smith's income was $50,000 in year 1 and $55,600 in year 2.The CPI was 114 in year 1 and 124 in year 2.What was the approximate percentage change in Smith's real income between the two years?

Describe what the term "full employment" means to an economist.

In year 1 the CPI is 140,and in year 2 the CPI is 160.From year 1 to year 2,Chiang's salary rises from $42,000 to $49,000,and Marta's salary rises from $55,000 to $60,000.Who is "more than keeping up with inflation"?

In order to be classified as unemployed,a person must be not working,

In year 1 the CPI is 181,and in year 2 the CPI is 195.If Dennis's salary was $95,000 in year 1,what is the minimum salary he must earn in year 2 to "keep up with inflation"?

The unemployment due to changes in the types of skills employers require is called __________ unemployment.

Discouraged workers are not counted as unemployed because they are working.

Which of the following statements is true?

In an economy with 100 million people,70 million hold civilian jobs and 19 million are not working but are looking for jobs.The unemployment rate is

In an economy with a population of 100 million persons,50 million hold civilian jobs and 20 million are not working but are looking for a job.The number of persons in the civilian labor force is

If the unemployment rate drops,then it necessarily follows that some of the people who were once unemployed are now employed.

In year 1 the CPI is 180,and in year 2 the CPI is 192.From year 1 to year 2,Javier's salary rises from $40,000 to $42,000,and Tom's salary rises from $55,000 to $57,000.Who is "more than keeping up with inflation"?

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free, controlled, and Relative

Supply,demand,and Price: Applications

Macroeconomic Measurements, part II: GDP and Real GDP

Aggregate Demand and Aggregate Supply

Classical Macroeconomics and the Self-Regulating Economy

Keynesian Macroeconomics and Economic Instability: a Critique of the Self-Regulating Economy

Fiscal Policy and the Federal Budget

Money,banking,and the Financial System

The Federal Reserve System

Money and the Economy

Monetary Policy

Expectations Theory and the Economy

Economic Growth: Resources, technology, ideas, and Institutions

The Financial Crisis of 2007-2009

Debates in Macroeconomics Over the Role and Effects of Government

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

Globalization and International Impacts on the Economy

The Economic Case for and Against Government: Five Topics Considered

Stocks, bonds, futures, and Options

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