Question 1

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 2

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 3

The advice to "retrain" would be most appropriate for which of the following types of unemployment?

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 4

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 5

If inflation is positive and is perfectly anticipated,

Accepted Answer

A) those that borrow money lose. 
B) those that lend money lose. 
C) those that hold paper money lose. 
D) no one in the economy loses. 
A) those that borrow money lose. 
B) those that lend money lose. 
C) those that hold paper money lose. 
D) no one in the economy loses.

Question 6

Sarah is a full-time student who is not looking for work.What kind of unemployment is Sarah experiencing?

Accepted Answer

A) cyclical 
B) structural 
C) frictional 
D) Sarah is not experiencing unemployment of any kind,because she is not currently part of the labor force. 
A) cyclical 
B) structural 
C) frictional 
D) Sarah is not experiencing unemployment of any kind,because she is not currently part of the labor force.

Question 7

Explain why you would rather be a borrower during a period of unexpected rising inflation,and a lender during a period of unexpected declining inflation.

Accepted Answer

The nominal interest rate includes a cha

Question 8

The real rate of interest is

Accepted Answer

A) the nominal interest rate plus the inflation rate. 
B) the nominal interest rate minus the inflation rate. 
C) the interest rate determined by the supply and demand in the money market. 
D) the nominal interest rate. 
A) the nominal interest rate plus the inflation rate. 
B) the nominal interest rate minus the inflation rate. 
C) the interest rate determined by the supply and demand in the money market. 
D) the nominal interest rate.

Question 9

-Refer to Table 9-1.The unemployment rate for this simple economy equals

Accepted Answer

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

Question 10

The nominal interest rate will be less than the real interest rate when

Accepted Answer

A) the rate of inflation is positive but decreasing. 
B) the rate of inflation is positive and increasing. 
C) the rate of inflation is negative. 
D) the real interest rate is negative. 
A) the rate of inflation is positive but decreasing. 
B) the rate of inflation is positive and increasing. 
C) the rate of inflation is negative. 
D) the real interest rate is negative.

Question 11

Table 9-14
   The table above reports the nominal average hourly earnings in private industry and the consumer price index for 1965 and 2010.
-Refer to Table 9-15.Looking at the table above,real average hourly earnings in 2011 were

Accepted Answer

A) $9. 
B) $9.52. 
C) $10. 
D) $12.63. 
A) $9. 
B) $9.52. 
C) $10. 
D) $12.63.

Question 12

Full employment is not considered to be zero unemployment,because

Accepted Answer

A) some cyclical unemployment always exists. 
B) some people do not want a job. 
C) there are not enough jobs for everyone who wants one. 
D) people do not find jobs instantaneously. 
A) some cyclical unemployment always exists. 
B) some people do not want a job. 
C) there are not enough jobs for everyone who wants one. 
D) people do not find jobs instantaneously.

Question 13

The costs to firms of changing prices are called menu costs.

Accepted Answer

A) True 
 B)False

Question 14

Suppose that in 2014,all prices in the economy double and that all wages and salaries also double.In 2014 you

Accepted Answer

A) are worse off than you were in 2013 as you can no longer afford to buy as many goods and services. 
B) are better off than you were in 2013 as your salary is higher than it was in 2013 and you can now buy more goods and services. 
C) are no better off or worse off than you were in 2013 as the purchasing power of your salary has remained the same. 
D) cannot determine whether you are better off or worse off than you were in 2013,because the purchasing power of your salary cannot be determined. 
A) are worse off than you were in 2013 as you can no longer afford to buy as many goods and services. 
B) are better off than you were in 2013 as your salary is higher than it was in 2013 and you can now buy more goods and services. 
C) are no better off or worse off than you were in 2013 as the purchasing power of your salary has remained the same. 
D) cannot determine whether you are better off or worse off than you were in 2013,because the purchasing power of your salary cannot be determined.

Question 15

The inflation rate measures the percentage increase in the price level from one year to the next.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following individuals would be most negatively affected by anticipated inflation?

Accepted Answer

A) a retired railroad engineer who receives a fixed income payment every month 
B) a union contractor whose pay is adjusted based on changes in the CPI 
C) a full-time employee at a pizza parlor who makes more than the minimum wage 
D) a student who borrows $10,000 at a nominal interest rate of 5% to finance educational expenses 
A) a retired railroad engineer who receives a fixed income payment every month 
B) a union contractor whose pay is adjusted based on changes in the CPI 
C) a full-time employee at a pizza parlor who makes more than the minimum wage 
D) a student who borrows $10,000 at a nominal interest rate of 5% to finance educational expenses

Question 17

Why might firms pay wages that are above the equilibrium wage in a market?

Accepted Answer

A) to increase the productivity of their workers 
B) to reduce the unemployment rate 
C) to encourage workers to form labor unions 
D) to reduce profit 
A) to increase the productivity of their workers 
B) to reduce the unemployment rate 
C) to encourage workers to form labor unions 
D) to reduce profit

Question 18

With the exception of during recessions,workers in Canada are eligible for unemployment benefits for about twice as long a period of time as workers in the United States.As a result,

Accepted Answer

A) the average duration of unemployment is longer in the United States than in Canada. 
B) the unemployment rate in Canada is usually higher than in the United States. 
C) the opportunity cost of job search in Canada is lower than in the United States. 
D) frictional unemployment is higher,on average,in the United States than in Canada. 
A) the average duration of unemployment is longer in the United States than in Canada. 
B) the unemployment rate in Canada is usually higher than in the United States. 
C) the opportunity cost of job search in Canada is lower than in the United States. 
D) frictional unemployment is higher,on average,in the United States than in Canada.

Question 19

The labor force equals the number of people

Accepted Answer

A) employed. 
B) unemployed. 
C) employed plus unemployed. 
D) in the working-age population. 
A) employed. 
B) unemployed. 
C) employed plus unemployed. 
D) in the working-age population.

Question 20

Establishing a state employment agency that speeds up the process of matching unemployed workers with unfilled jobs is an attempt to lower

Accepted Answer

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

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

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

The advice to "retrain" would be most appropriate for which of the following types of unemployment?

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

If inflation is positive and is perfectly anticipated,

Sarah is a full-time student who is not looking for work.What kind of unemployment is Sarah experiencing?

Explain why you would rather be a borrower during a period of unexpected rising inflation,and a lender during a period of unexpected declining inflation.

The real rate of interest is

-Refer to Table 9-1.The unemployment rate for this simple economy equals

The nominal interest rate will be less than the real interest rate when

Table 9-14 The table above reports the nominal average hourly earnings in private industry and the consumer price index for 1965 and 2010. -Refer to Table 9-15.Looking at the table above,real average hourly earnings in 2011 were

Full employment is not considered to be zero unemployment,because

The costs to firms of changing prices are called menu costs.

Suppose that in 2014,all prices in the economy double and that all wages and salaries also double.In 2014 you

The inflation rate measures the percentage increase in the price level from one year to the next.

Which of the following individuals would be most negatively affected by anticipated inflation?

Why might firms pay wages that are above the equilibrium wage in a market?

With the exception of during recessions,workers in Canada are eligible for unemployment benefits for about twice as long a period of time as workers in the United States.As a result,

The labor force equals the number of people

Establishing a state employment agency that speeds up the process of matching unemployed workers with unfilled jobs is an attempt to lower

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

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

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

The advice to "retrain" would be most appropriate for which of the following types of unemployment?

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

If inflation is positive and is perfectly anticipated,

Sarah is a full-time student who is not looking for work.What kind of unemployment is Sarah experiencing?

Explain why you would rather be a borrower during a period of unexpected rising inflation,and a lender during a period of unexpected declining inflation.

The real rate of interest is

-Refer to Table 9-1.The unemployment rate for this simple economy equals

The nominal interest rate will be less than the real interest rate when

Table 9-14 The table above reports the nominal average hourly earnings in private industry and the consumer price index for 1965 and 2010. -Refer to Table 9-15.Looking at the table above,real average hourly earnings in 2011 were

Full employment is not considered to be zero unemployment,because

The costs to firms of changing prices are called menu costs.

Suppose that in 2014,all prices in the economy double and that all wages and salaries also double.In 2014 you

The inflation rate measures the percentage increase in the price level from one year to the next.

Which of the following individuals would be most negatively affected by anticipated inflation?

Why might firms pay wages that are above the equilibrium wage in a market?

With the exception of during recessions,workers in Canada are eligible for unemployment benefits for about twice as long a period of time as workers in the United States.As a result,

The labor force equals the number of people

Establishing a state employment agency that speeds up the process of matching unemployed workers with unfilled jobs is an attempt to lower

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