Question 1

Considering the data in the table shown above and 2010 as the base year, what is the inflation rate between years 2010 and 2018?

Accepted Answer

A)  0.0 percent 
B)  41.7 percent 
C)  17.1 percent 
D)  3.4 percent 
A)  0.0 percent 
B)  41.7 percent 
C)  17.1 percent 
D)  3.4 percent

Question 2

Which of the following would NOT be a factor that has contributed to the rising female labor force participation rate?

Accepted Answer

A)  greater access to education 
B)  greater access to training 
C)  increasing family size 
D)  reduction of barriers to competing with men for jobs 
A)  greater access to education 
B)  greater access to training 
C)  increasing family size 
D)  reduction of barriers to competing with men for jobs

Question 3

The labor force in the United States includes

Accepted Answer

A)  discouraged workers. 
B)  those over the age of 16 who are employed or are seeking employment. 
C)  those between ages 12 and 16 who are actually working. 
D)  all of the above. 
A)  discouraged workers. 
B)  those over the age of 16 who are employed or are seeking employment. 
C)  those between ages 12 and 16 who are actually working. 
D)  all of the above.

Question 4

In sequential order, the four phases of the business cycle are

Accepted Answer

A)  trough, peak, expansion, contraction. 
B)  peak, contraction, trough, expansion. 
C)  expansion, contraction, peak, trough. 
D)  contraction, trough, peak, expansion. 
A)  trough, peak, expansion, contraction. 
B)  peak, contraction, trough, expansion. 
C)  expansion, contraction, peak, trough. 
D)  contraction, trough, peak, expansion.

Question 5

Environmental regulation reduces the demand for West Virginia coal and the unemployment rate in West Virginia increases. This is an example of

Accepted Answer

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

Question 6

-Refer to the above table. You are given information on Jasmin's consumption for 2005 and 2015. Using 2005 as the base year compute the price index for 2015. The index equals

Accepted Answer

A)  40.35. 
B)  247.826. 
C)  0.4035. 
D)  0.2478. 
A)  40.35. 
B)  247.826. 
C)  0.4035. 
D)  0.2478.

Question 7

Under which one of the following situations would you be better off?

Accepted Answer

A)  You have $10,000 in your savings account paying 5 percent per year and unanticipated inflation is 8 percent per year. 
B)  You have paid $500 for a $1,000 U.S. savings bond that matures in 10 years and unanticipated inflation is 10 percent per year. 
C)  You lend a friend $10,000 at 2 percent to be repaid in one year and unanticipated inflation is 4 percent during the year. 
D)  You borrowed $10,00 at 2 percent to pay for this year's college expenses and unanticipated inflation is 3 percent during the year. 
A)  You have $10,000 in your savings account paying 5 percent per year and unanticipated inflation is 8 percent per year. 
B)  You have paid $500 for a $1,000 U.S. savings bond that matures in 10 years and unanticipated inflation is 10 percent per year. 
C)  You lend a friend $10,000 at 2 percent to be repaid in one year and unanticipated inflation is 4 percent during the year. 
D)  You borrowed $10,00 at 2 percent to pay for this year's college expenses and unanticipated inflation is 3 percent during the year.

Question 8

Unanticipated positive inflation will create

Accepted Answer

A)  losses for creditors and gains for debtors. 
B)  losses for both creditors and debtors. 
C)  gains for both creditors and debtors. 
D)  gains for creditors and losses for debtors. 
A)  losses for creditors and gains for debtors. 
B)  losses for both creditors and debtors. 
C)  gains for both creditors and debtors. 
D)  gains for creditors and losses for debtors.

Question 9

A person who is employed in the construction industry may frequently experience

Accepted Answer

A)  frictional unemployment. 
B)  structural unemployment. 
C)  seasonal unemployment. 
D)  technological unemployment. 
A)  frictional unemployment. 
B)  structural unemployment. 
C)  seasonal unemployment. 
D)  technological unemployment.

Question 10

Which one of the following accurately describes the trends in U.S. labor force participation over the past 50 years?

Accepted Answer

A)  The labor force participation rate of men has climbed from about 75 percent to 90 percent. 
B)  The labor force participation rate of women has climbed from below 40 percent to about 60 percent. 
C)  The labor force participation rates for both men and women have declined. 
D)  The overall labor force participation rate has held steady at about 85 percent. 
A)  The labor force participation rate of men has climbed from about 75 percent to 90 percent. 
B)  The labor force participation rate of women has climbed from below 40 percent to about 60 percent. 
C)  The labor force participation rates for both men and women have declined. 
D)  The overall labor force participation rate has held steady at about 85 percent.

Question 11

Structural unemployment results when

Accepted Answer

A)  a reduction in consumer income reduces demand for products. 
B)  individuals enter the labor market in June following graduation. 
C)  workers face layoffs following a decrease in economic activity. 
D)  the introduction of a product substitute leads to a large decline in the market demand for a product so that workers specializing in the production of that product find themselves out of work. 
A)  a reduction in consumer income reduces demand for products. 
B)  individuals enter the labor market in June following graduation. 
C)  workers face layoffs following a decrease in economic activity. 
D)  the introduction of a product substitute leads to a large decline in the market demand for a product so that workers specializing in the production of that product find themselves out of work.

Question 12

The official dating of recessions is done by

Accepted Answer

A)  the Council of Economic Advisors. 
B)  the National Bureau of Economic Research. 
C)  the Government Accounting Office. 
D)  the Secretary of the Treasury. 
A)  the Council of Economic Advisors. 
B)  the National Bureau of Economic Research. 
C)  the Government Accounting Office. 
D)  the Secretary of the Treasury.

Question 13

Historically, the United States has experienced

Accepted Answer

A)  continuous decreases in the unemployment rate since World War II. 
B)  periods of both increases and decreases in the unemployment rate since World War II. 
C)  continuous increases in the unemployment rate since World War II. 
D)  no changes in the unemployment rate since World War II. 
A)  continuous decreases in the unemployment rate since World War II. 
B)  periods of both increases and decreases in the unemployment rate since World War II. 
C)  continuous increases in the unemployment rate since World War II. 
D)  no changes in the unemployment rate since World War II.

Question 14

If 2010 is the base year in the table shown above, what is the price index for the year 2010?

Accepted Answer

A)  100.0 
B)  121.3 
C)  147.1 
D)  141.7 
A)  100.0 
B)  121.3 
C)  147.1 
D)  141.7

Question 15

If the current price of a market basket of goods is $850 and the base year price for the same market basket is $500, what is the value of the price index?

Accepted Answer

A)  140 
B)  170 
C)  120 
D)  100 
A)  140 
B)  170 
C)  120 
D)  100

Question 16

If the nominal interest rate is 4 percent and the anticipated inflation rate is 6 percent, then

Accepted Answer

A)  the real interest rate is -10 percent. 
B)  the real interest rate is 10 percent. 
C)  the real interest rate is -2 percent. 
D)  the real interest rate is 2 percent. 
A)  the real interest rate is -10 percent. 
B)  the real interest rate is 10 percent. 
C)  the real interest rate is -2 percent. 
D)  the real interest rate is 2 percent.

Question 17

-Refer to the above figure. The points between B and C are known as

Accepted Answer

A)  a peak. 
B)  a trough. 
C)  an expansion. 
D)  a contraction. 
A)  a peak. 
B)  a trough. 
C)  an expansion. 
D)  a contraction.

Question 18

The nominal value of a good is

Accepted Answer

A)  the good's value expressed in purchasing power terms. 
B)  the good's anticipated value one year from now. 
C)  the price of the good in today's dollars, minus an anticipated inflation premium. 
D)  the price of the good in today's dollars. 
A)  the good's value expressed in purchasing power terms. 
B)  the good's anticipated value one year from now. 
C)  the price of the good in today's dollars, minus an anticipated inflation premium. 
D)  the price of the good in today's dollars.

Question 19

Which one of the following is TRUE?

Accepted Answer

A)  The nominal rate of interest is the real rate plus the anticipated rate of inflation. 
B)  The real rate of interest is the nominal rate plus the anticipated rate of inflation. 
C)  Increases in anticipated inflation increase the real interest rate. 
D)  Increases in the CPI increase the real interest rate. 
A)  The nominal rate of interest is the real rate plus the anticipated rate of inflation. 
B)  The real rate of interest is the nominal rate plus the anticipated rate of inflation. 
C)  Increases in anticipated inflation increase the real interest rate. 
D)  Increases in the CPI increase the real interest rate.

Question 20

Frictional unemployment will always exist since

Accepted Answer

A)  some workers will always want to make a job transition. 
B)  the capitalist system promotes unemployment. 
C)  mismatches in skills will always exist. 
D)  the U.S. economy will continue to shrink. 
A)  some workers will always want to make a job transition. 
B)  the capitalist system promotes unemployment. 
C)  mismatches in skills will always exist. 
D)  the U.S. economy will continue to shrink.

Exam 7: The Macroeconomy: Unemployment, Inflation, and Deflation

Considering the data in the table shown above and 2010 as the base year, what is the inflation rate between years 2010 and 2018?

Which of the following would NOT be a factor that has contributed to the rising female labor force participation rate?

The labor force in the United States includes

In sequential order, the four phases of the business cycle are

Environmental regulation reduces the demand for West Virginia coal and the unemployment rate in West Virginia increases. This is an example of

-Refer to the above table. You are given information on Jasmin's consumption for 2005 and 2015. Using 2005 as the base year compute the price index for 2015. The index equals

Under which one of the following situations would you be better off?

Unanticipated positive inflation will create

A person who is employed in the construction industry may frequently experience

Which one of the following accurately describes the trends in U.S. labor force participation over the past 50 years?

Structural unemployment results when

The official dating of recessions is done by

Historically, the United States has experienced

If 2010 is the base year in the table shown above, what is the price index for the year 2010?

If the current price of a market basket of goods is $850 and the base year price for the same market basket is $500, what is the value of the price index?

If the nominal interest rate is 4 percent and the anticipated inflation rate is 6 percent, then

-Refer to the above figure. The points between B and C are known as

The nominal value of a good is

Which one of the following is TRUE?

Frictional unemployment will always exist since

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Measuring the Economys Performance

Global Economic Growth and Development

Real GDP and the Price Level in the Long Run

Classical and Keynesian Macro Analyses

Consumption, Real GDP, and the Multiplier

Fiscal Policy

Deficit Spending and the Public Debt

Money, Banking, and Central Banking

Domestic and International Dimensions of Monetary Policy

Stabilization in an Integrated World Economy

Policies and Prospects for Global Economic Growth

Demand and Supply Elasticity

Consumer Choice

Rents, Profits, and the Financial Environment of Business

The Firm: Cost and Output Determination

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, Supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, Poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

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