Question 1

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 2

Based in part on the aftermath of the financial crisis that began in 2008 and the speed of the recovery of the U.S.economy following the recession of 2007-2009,Bank of America ________ the number of persons it employed in September 2011 and this ________ the total number of persons unemployed in the economy.

Accepted Answer

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

Question 3

The real wage equals the nominal wage ________ the CPI,all times 100.

Accepted Answer

A)  divided by 
B)  times 
C)  minus 
D)  plus 
A)  divided by 
B)  times 
C)  minus 
D)  plus

Question 4

Most economists believe that labor unions significantly increase the overall unemployment rate in the United States.

Accepted Answer

A) True 
 B)False

Question 5

When actual inflation is less than expected inflation,

Accepted Answer

A)  borrowers lose and lenders gain. 
B)  borrowers gain and lenders lose. 
C)  borrowers and lenders both gain. 
D)  borrowers and lenders both lose. 
A)  borrowers lose and lenders gain. 
B)  borrowers gain and lenders lose. 
C)  borrowers and lenders both gain. 
D)  borrowers and lenders both lose.

Question 6

The increase in quality bias in the consumer price index refers to the idea that price increases in the CPI reflect pure inflation,but ________ quality increases.This causes the CPI to ________ the cost of the market basket.

Accepted Answer

A)  also; understate 
B)  also; overstate 
C)  not; understate 
D)  not; overstate 
A)  also; understate 
B)  also; overstate 
C)  not; understate 
D)  not; overstate

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

Minimum wage laws cause unemployment because the legal minimum wage is set

Accepted Answer

A)  below the market wage, causing labor demand to be greater than labor supply. 
B)  below the market wage, causing labor demand to be less than labor supply. 
C)  above the market wage, causing labor demand to be greater than labor supply. 
D)  above the market wage, causing labor demand to be less than labor supply. 
E)  too low. 
A)  below the market wage, causing labor demand to be greater than labor supply. 
B)  below the market wage, causing labor demand to be less than labor supply. 
C)  above the market wage, causing labor demand to be greater than labor supply. 
D)  above the market wage, causing labor demand to be less than labor supply. 
E)  too low.

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

Based in part on the aftermath of the financial crisis that began in 2008 and the speed of the recovery of the U.S.economy following the recession of 2007-2009,Bank of America the number of persons it employed in September 2011 and this the total number of persons unemployed in the economy.

The real wage equals the nominal wage ________ the CPI,all times 100.

Most economists believe that labor unions significantly increase the overall unemployment rate in the United States.

When actual inflation is less than expected inflation,

The increase in quality bias in the consumer price index refers to the idea that price increases in the CPI reflect pure inflation,but quality increases.This causes the CPI to the cost of the market basket.

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

Minimum wage laws cause unemployment because the legal minimum wage is set

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

Externalities, environmental Policy, and Public Goods

Elasticity: The Responsiveness of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition: The Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, taxes, and the Distribution of Income

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 20: Unemployment and Inflation

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

The real wage equals the nominal wage ________ the CPI,all times 100.

Most economists believe that labor unions significantly increase the overall unemployment rate in the United States.

When actual inflation is less than expected inflation,

The increase in quality bias in the consumer price index refers to the idea that price increases in the CPI reflect pure inflation,but ________ quality increases.This causes the CPI to ________ the cost of the market basket.

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

Minimum wage laws cause unemployment because the legal minimum wage is set

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

Externalities, environmental Policy, and Public Goods

Elasticity: The Responsiveness of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition: The Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, taxes, and the Distribution of Income

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

The increase in quality bias in the consumer price index refers to the idea that price increases in the CPI reflect pure inflation,but quality increases.This causes the CPI to the cost of the market basket.