Question 1

Given a fixed nominal interest rate on a loan, unanticipated deflation:

Accepted Answer

A) decreases the burden of paying off the loan. 
B) increases the burden of paying off the loan. 
C) does not alter the burden of paying off the loan. 
D) has an indeterminate effect on the burden of paying off the loan. 
A) decreases the burden of paying off the loan. 
B) increases the burden of paying off the loan. 
C) does not alter the burden of paying off the loan. 
D) has an indeterminate effect on the burden of paying off the loan.

Question 2

The existence of discouraged workers:

Accepted Answer

A) increases the size of the labor force, but does not affect the unemployment rate. 
B) reduces the size of the labor force, but does not affect the unemployment rate. 
C) may cause the official unemployment rate to understate the true amount of unemployment. 
D) may cause the official unemployment rate to overstate the true amount of unemployment. 
A) increases the size of the labor force, but does not affect the unemployment rate. 
B) reduces the size of the labor force, but does not affect the unemployment rate. 
C) may cause the official unemployment rate to understate the true amount of unemployment. 
D) may cause the official unemployment rate to overstate the true amount of unemployment.

Question 3

____ experience higher rates of unemployment than do ____.

Accepted Answer

A) Teenagers; adults 
B) Adult males; adult females 
C) Skilled workers; unskilled workers 
D) White males; Hispanic males 
A) Teenagers; adults 
B) Adult males; adult females 
C) Skilled workers; unskilled workers 
D) White males; Hispanic males

Question 4

The period of declining growth in real GDP, between the peak of the business cycle and the trough, is called the:

Accepted Answer

A) contractionary phase. 
B) boom. 
C) expansionary phase. 
D) static phase. 
A) contractionary phase. 
B) boom. 
C) expansionary phase. 
D) static phase.

Question 5

Another name for the contractionary phase of a business cycle is recession.

Accepted Answer

A) True 
 B)False

Question 6

Bill looked for work for six months but could not find a job to his liking.He now spends his time at the beach.For purposes of employment he is considered:

Accepted Answer

A) out of the labor force. 
B) unemployed. 
C) employed in the underground economy. 
D) underemployed. 
E) in the labor force. 
A) out of the labor force. 
B) unemployed. 
C) employed in the underground economy. 
D) underemployed. 
E) in the labor force.

Question 7

Persons who do not have jobs and who do not look for work are considered:

Accepted Answer

A) unemployed. 
B) out of the labor force. 
C) underemployed. 
D) overemployed. 
E) part of the underground economy. 
A) unemployed. 
B) out of the labor force. 
C) underemployed. 
D) overemployed. 
E) part of the underground economy.

Question 8

A healthy economy would be characterized by a relatively ____ unemployment rate and a relatively ____ labor force participation rate.

Accepted Answer

A) low; low 
B) low; high 
C) high; low 
D) high; high 
A) low; low 
B) low; high 
C) high; low 
D) high; high

Question 9

The category of unemployment that is a byproduct of geographic and occupational mobility and not generally considered to be a serious problem is:

Accepted Answer

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

Question 10

Which of the following statements is incorrect?

Accepted Answer

A) Demand and supply curves for labor are constantly shifting. 
B) The typical unemployment compensation in the United States is roughly half one's salary for up to 26 weeks. 
C) Unemployment compensation increases the opportunity cost of being unemployed. 
D) Unemployment compensation encourages longer job searches, which may lead to a better match between jobs and employees. 
A) Demand and supply curves for labor are constantly shifting. 
B) The typical unemployment compensation in the United States is roughly half one's salary for up to 26 weeks. 
C) Unemployment compensation increases the opportunity cost of being unemployed. 
D) Unemployment compensation encourages longer job searches, which may lead to a better match between jobs and employees.

Question 11

Real gross domestic product is the total value of all:

Accepted Answer

A) goods and services adjusted for inflation. 
B) goods and services without an adjustment for inflation. 
C) final goods and services adjusted for inflation. 
D) final goods and services without adjustment for inflation. 
E) intermediate goods and services without adjustment for inflation. 
A) goods and services adjusted for inflation. 
B) goods and services without an adjustment for inflation. 
C) final goods and services adjusted for inflation. 
D) final goods and services without adjustment for inflation. 
E) intermediate goods and services without adjustment for inflation.

Question 12

The costs imposed on a firm from changing listed prices is termed:

Accepted Answer

A) the nominal cost of inflation. 
B) the shoe-leather cost of inflation. 
C) the menu cost of inflation. 
D) the implied cost of inflation. 
A) the nominal cost of inflation. 
B) the shoe-leather cost of inflation. 
C) the menu cost of inflation. 
D) the implied cost of inflation.

Question 13

The unemployment rate in a town in which 65,400 persons are employed and 11,000 are unemployed equals:

Accepted Answer

A) 11 percent. 
B) 14.4 percent. 
C) 16.8 percent. 
D) 20.2 percent. 
E) cannot be determined from the information provided. 
A) 11 percent. 
B) 14.4 percent. 
C) 16.8 percent. 
D) 20.2 percent. 
E) cannot be determined from the information provided.

Question 14

Suppose you live in a community of 100 people where everyone is able and seeks to work.If 80 people are over 16 years old and 72 of them are employed, what is the unemployment rate in this community?

Accepted Answer

In this community, only 80 peo

Question 15

A welder who quits his job and moves from Houston to Buffalo to try to get a better welding job is said to be:

Accepted Answer

A) frictionally unemployed. 
B) underemployed. 
C) cyclically unemployed. 
D) structurally unemployed. 
E) a discouraged worker. 
A) frictionally unemployed. 
B) underemployed. 
C) cyclically unemployed. 
D) structurally unemployed. 
E) a discouraged worker.

Question 16

A discouraged worker is someone who:

Accepted Answer

A) has a job, but wants to get a different one. 
B) works part time, but is actively seeking full-time work. 
C) is unemployed and looking for work. 
D) quits a job and is unable to collect unemployment compensation. 
E) gives up looking for work, and is no longer counted as unemployed. 
A) has a job, but wants to get a different one. 
B) works part time, but is actively seeking full-time work. 
C) is unemployed and looking for work. 
D) quits a job and is unable to collect unemployment compensation. 
E) gives up looking for work, and is no longer counted as unemployed.

Question 17

How do high rates of inflation lead to an increased frequency of cash withdrawals from an ATM or a bank?

Accepted Answer

High rates of inflation erode the value

Question 18

The index of leading economic indicators usually turns downward:

Accepted Answer

A) prior to economic expansions. 
B) prior to economic contractions. 
C) prior to a contraction, but then turns upward before the contraction begins. 
D) a full 24 months before a recession begins. 
A) prior to economic expansions. 
B) prior to economic contractions. 
C) prior to a contraction, but then turns upward before the contraction begins. 
D) a full 24 months before a recession begins.

Question 19

Why do economists prefer using the term economic fluctuation rather than business cycle?

Accepted Answer

A) political correctness 
B) number of parameters involved 
C) excessive volatility of the cycles 
D) lack of regularity of a cycle 
A) political correctness 
B) number of parameters involved 
C) excessive volatility of the cycles 
D) lack of regularity of a cycle

Question 20

A city in which 320,000 persons are employed has a labor force of 359,500 persons.The unemployment rate for the city is:

Accepted Answer

A) 7.8 percent. 
B) 11.0 percent. 
C) 12.3 percent. 
D) 14.5 percent. 
E) none of the above. 
A) 7.8 percent. 
B) 11.0 percent. 
C) 12.3 percent. 
D) 14.5 percent. 
E) none of the above.

Given a fixed nominal interest rate on a loan, unanticipated deflation:

The existence of discouraged workers:

experience higher rates of unemployment than do .

The period of declining growth in real GDP, between the peak of the business cycle and the trough, is called the:

Another name for the contractionary phase of a business cycle is recession.

Bill looked for work for six months but could not find a job to his liking.He now spends his time at the beach.For purposes of employment he is considered:

Persons who do not have jobs and who do not look for work are considered:

A healthy economy would be characterized by a relatively unemployment rate and a relatively labor force participation rate.

The category of unemployment that is a byproduct of geographic and occupational mobility and not generally considered to be a serious problem is:

Which of the following statements is incorrect?

Real gross domestic product is the total value of all:

The costs imposed on a firm from changing listed prices is termed:

The unemployment rate in a town in which 65,400 persons are employed and 11,000 are unemployed equals:

Suppose you live in a community of 100 people where everyone is able and seeks to work.If 80 people are over 16 years old and 72 of them are employed, what is the unemployment rate in this community?

A welder who quits his job and moves from Houston to Buffalo to try to get a better welding job is said to be:

A discouraged worker is someone who:

How do high rates of inflation lead to an increased frequency of cash withdrawals from an ATM or a bank?

The index of leading economic indicators usually turns downward:

Why do economists prefer using the term economic fluctuation rather than business cycle?

A city in which 320,000 persons are employed has a labor force of 359,500 persons.The unemployment rate for the city is:

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters

Exam 11: Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Given a fixed nominal interest rate on a loan, unanticipated deflation:

The existence of discouraged workers:

____ experience higher rates of unemployment than do ____.

The period of declining growth in real GDP, between the peak of the business cycle and the trough, is called the:

Another name for the contractionary phase of a business cycle is recession.

Bill looked for work for six months but could not find a job to his liking.He now spends his time at the beach.For purposes of employment he is considered:

Persons who do not have jobs and who do not look for work are considered:

A healthy economy would be characterized by a relatively ____ unemployment rate and a relatively ____ labor force participation rate.

The category of unemployment that is a byproduct of geographic and occupational mobility and not generally considered to be a serious problem is:

Which of the following statements is incorrect?

Real gross domestic product is the total value of all:

The costs imposed on a firm from changing listed prices is termed:

The unemployment rate in a town in which 65,400 persons are employed and 11,000 are unemployed equals:

Suppose you live in a community of 100 people where everyone is able and seeks to work.If 80 people are over 16 years old and 72 of them are employed, what is the unemployment rate in this community?

A welder who quits his job and moves from Houston to Buffalo to try to get a better welding job is said to be:

A discouraged worker is someone who:

How do high rates of inflation lead to an increased frequency of cash withdrawals from an ATM or a bank?

The index of leading economic indicators usually turns downward:

Why do economists prefer using the term economic fluctuation rather than business cycle?

A city in which 320,000 persons are employed has a labor force of 359,500 persons.The unemployment rate for the city is:

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters

experience higher rates of unemployment than do .

A healthy economy would be characterized by a relatively unemployment rate and a relatively labor force participation rate.