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

Suppose that you borrow $50,000 from the bank to purchase some land and you agree to pay 2 percent interest on the loan. If the loan must be repaid in 12 months and the inflation rate is 4 percent during the year, then

In the base year the price index

A period in which the level of business is consistently less than its long-term trend is known as

Which of the following explains why frictional unemployment exists?

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

If I voluntarily end my employment, the Bureau of Labor Statistics would consider me to be

In 2014, some European countries were dealing with a recession. Workers who were laid off in those countries due to the economic downturn would be

Unanticipated positive inflation

The business cycle phase that must come before the peak is a(n)

Unemployed U.S. residents who are, in effect, merely searching for work between jobs, are defined as

Distinguishing between stock measures and flow measures of the labor force, the stock measures are

An example of a cyclically unemployed individual is

The United States experienced a deep recession between 2007 and 2009. Which type of unemployment would most likely increase during that period of recession?

The population of a small town is 5,000. There are 4,000 people in the labor force, and 3,500 people are employed. The unemployment rate equals

A huge snow storm that disrupted U.S. economic activity is known as

Suppose the population of El Campo is 120,000. Of the population 16 years and older, 50,000 are employed, 10,000 have never worked and are not looking for work, 5,000 are not working and are looking for work, and 15,000 are retired and not looking for work. The labor force equals

Cyclical unemployment is caused by

The labor force is defined as

Deflation refers to a situation in which

The GDP deflator is NOT a fixed-quantity price index, but the CPI is. What is the significance of this fact?