Exam 20: Unemployment and Inflation

Your grandfather tells you that he earned $7,000/year in his first job in 1961.You earn $35,000/year in your first job in 2011.You know that average prices have risen steadily since 1961.You earn

Suppose your grandfather earned a salary of $12,000 in 1964.If the CPI is 31 in 1964 and 219 in 2010,then the value of your grandfather's salary in 2010 dollars is approximately

To understand why someone cannot get a job,it helps to know the three types of unemployment.List the three types of unemployment and explain what causes each type.What advice for finding a job would be appropriate for someone in each type of unemployment?

Table 20-10 Salaries in major league baseball have soared over the last 30 to 40 years. Some of the salary increase is due to inflation. The table above reports the consumer price index and the median nominal salary of the New York Yankees for 1989 and 2009. Source: USA Today Salaries Database, asp.usatoday.com/sports/baseball/salaries/default.aspx -Refer to Table 20-10.Calculate the real median salary of the New York Yankees in both 1982-1984 dollars and 2009 dollars.Calculate the percentage increase in the median salary of the Yankees from 1989 to 2009 in both nominal terms and in real terms.

A student who just graduated from college but has not found a job would most likely be

If the price level rose in three consecutive years from 100 to 120 to 140,then the annual inflation rate over those years would

Table 20-11 Source: Energy Information Administration -Refer to Table 20-11.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.

The average price of goods and services in the economy is also known as

Suppose that homemakers are included as employed in the labor force statistics,rather than being counted as out of the labor force.This would

Efficiency wages cause unemployment because

Which of the following would be the best measure of the cost of living?

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

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

Table 20-8 The table above reports the nominal average hourly earnings in private industry and the consumer price index for 1965 and 2010. -Refer to Table 20-8.The real average hourly earnings for 1965 in 2010 dollars equal

Table 20-9 -Refer to Table 20-9.Looking at the table above,real average hourly earnings were equal to ________ in 2010.

The United States has ________ social insurance programs,and generally has a ________ unemployment rate,as compared to Canada and Western Europe.

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.

Table 20-2 -Refer to Table 20-2.Assume the market basket for the consumer price index has two products bread and milk with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals

When deflation occurs,

Structural unemployment is the result of