Question 1

Which of the following is a desirable characteristic in an economy?

Accepted Answer

A)  growing per-capita output 
B)  rapid increase in the general price level 
C)  population growing the same rate as output 
D)  population growing faster than output 
A)  growing per-capita output 
B)  rapid increase in the general price level 
C)  population growing the same rate as output 
D)  population growing faster than output

Question 2

The actual real rate of interest is the nominal rate less the actual inflation rate.

Accepted Answer

A) True 
 B)False

Question 3

The per-hour output produced by a worker describes the

Accepted Answer

A)  labor force participation rate. 
B)  capital per worker ratio. 
C)  nominal worker growth standard. 
D)  productivity of workers. 
A)  labor force participation rate. 
B)  capital per worker ratio. 
C)  nominal worker growth standard. 
D)  productivity of workers.

Question 4

Output in an economy can be decreased by

Accepted Answer

A)  adding more workers. 
B)  limiting the work week. 
C)  using more machines. 
D)  all of the above 
A)  adding more workers. 
B)  limiting the work week. 
C)  using more machines. 
D)  all of the above

Question 5

Anyone 16 years of age or older who is not classified as employed is still a member of the labor force.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following statements is true?

Accepted Answer

A)  An individual living on a fixed income is always made better off as a result of deflation. 
B)  Those individuals receiving welfare benefits have been harmed by inflation because increases in welfare payments have not kept pace with inflation. 
C)  Inflation will have no effect on an individual whose income is indexed to the inflation rate. 
D)  Everyone in society benefits from inflation. 
A)  An individual living on a fixed income is always made better off as a result of deflation. 
B)  Those individuals receiving welfare benefits have been harmed by inflation because increases in welfare payments have not kept pace with inflation. 
C)  Inflation will have no effect on an individual whose income is indexed to the inflation rate. 
D)  Everyone in society benefits from inflation.

Question 7

Tony has just graduated from college and has now applied for a full time position where he is currently working part-time. This causes the unemployment rate to ________ and the labor-force participation rate to ________.

Accepted Answer

A)  increase; decrease 
B)  stay the same; stay the same 
C)  increase; increase 
D)  increase; stay the same 
A)  increase; decrease 
B)  stay the same; stay the same 
C)  increase; increase 
D)  increase; stay the same

Question 8

Refer to the information provided in Table 7.5 below to answer the questions that follow.
Table 7.5  
-Refer to Table 7.5. Suppose 2015 is the base year. The price index in 2014 is

Accepted Answer

A)  94.2. 
B)  97.4. 
C)  106.1. 
D)  123.0. 
A)  94.2. 
B)  97.4. 
C)  106.1. 
D)  123.0.

Question 9

The decrease in the demand for mainframe computers caused manufacturers of mainframe computers to reduce prices by 20%. This is an example of

Accepted Answer

A)  inflation. 
B)  deflation. 
C)  a sustained inflation. 
D)  the operations of supply and demand. 
A)  inflation. 
B)  deflation. 
C)  a sustained inflation. 
D)  the operations of supply and demand.

Question 10

Of the following years, in which was the U.S. unemployment rate the highest?

Accepted Answer

A)  1960 
B)  1982 
C)  1990 
D)  2015 
A)  1960 
B)  1982 
C)  1990 
D)  2015

Question 11

The productivity of workers is defined as the

Accepted Answer

A)  total output produced by the labor force. 
B)  output produced by a worker per hour. 
C)  number of hours a worker spends at work. 
D)  number of workers needed to produce one day's volume of output. 
A)  total output produced by the labor force. 
B)  output produced by a worker per hour. 
C)  number of hours a worker spends at work. 
D)  number of workers needed to produce one day's volume of output.

Question 12

Related to the Economics in Practice on p. 127: In the U.S. from 1955 to 1996, the labor force participation rate increased for ________ and decreased for ________.

Accepted Answer

A)  men; women 
B)  women; men 
C)  white men; African American men 
D)  African American women; white women 
A)  men; women 
B)  women; men 
C)  white men; African American men 
D)  African American women; white women

Question 13

A textile firm closes a plant in Massachusetts and transfers production to a plant in South Carolina, where the firm can take advantage of cheaper labor. The plant supervisor at the Massachusetts plant is given the opportunity to move to South Carolina to become the plant supervisor at that plant. He turns down this opportunity because of family obligations. While he is searching for a new job he would be classified as

Accepted Answer

A)  structurally unemployed. 
B)  cyclically unemployed. 
C)  frictionally unemployed. 
D)  not in the labor force because he turned down the opportunity to relocate. 
A)  structurally unemployed. 
B)  cyclically unemployed. 
C)  frictionally unemployed. 
D)  not in the labor force because he turned down the opportunity to relocate.

Question 14

The type of unemployment most closely related to recessions is cyclical unemployment.

Accepted Answer

A) True 
 B)False

Question 15

Unemployment that occurs during the normal workings of an economy as people change jobs and move across the country is called

Accepted Answer

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

Question 16

Related to the Economics in Practice on p. 128: Compared to students who graduate college and obtain employment during an economic expansion, students who graduate during a recession often find that starting wages are ________ and wage growth is ________.

Accepted Answer

A)  lower; slower 
B)  lower; faster 
C)  higher; slower 
D)  higher; faster 
A)  lower; slower 
B)  lower; faster 
C)  higher; slower 
D)  higher; faster

Question 17

When the Fed increases the rate of growth of the money supply to jump start the economy, the unemployment type that will be directly affected is the

Accepted Answer

A)  cyclical unemployment. 
B)  structural unemployment. 
C)  frictional unemployment. 
D)  natural rate of unemployment. 
A)  cyclical unemployment. 
B)  structural unemployment. 
C)  frictional unemployment. 
D)  natural rate of unemployment.

Question 18

Refer to the information provided in Table 7.6 below to answer the questions that follow.
Table 7.6  
-Refer to Table 7.6. If 2015 is the base year, the price index in 2016 is

Accepted Answer

A)  86.1. 
B)  87.8. 
C)  112.2. 
D)  113.9. 
A)  86.1. 
B)  87.8. 
C)  112.2. 
D)  113.9.

Question 19

The number of tools or machines each worker has to work with measures the

Accepted Answer

A)  average wage rate of workers. 
B)  labor force participation rate. 
C)  capital per worker ratio. 
D)  productivity of workers. 
A)  average wage rate of workers. 
B)  labor force participation rate. 
C)  capital per worker ratio. 
D)  productivity of workers.

Question 20

An auto worker in Ohio who loses her job because the company relocated the plant to another country represents an example of

Accepted Answer

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

Which of the following is a desirable characteristic in an economy?

The actual real rate of interest is the nominal rate less the actual inflation rate.

The per-hour output produced by a worker describes the

Output in an economy can be decreased by

Anyone 16 years of age or older who is not classified as employed is still a member of the labor force.

Which of the following statements is true?

Tony has just graduated from college and has now applied for a full time position where he is currently working part-time. This causes the unemployment rate to and the labor-force participation rate to .

Refer to the information provided in Table 7.5 below to answer the questions that follow. Table 7.5 -Refer to Table 7.5. Suppose 2015 is the base year. The price index in 2014 is

The decrease in the demand for mainframe computers caused manufacturers of mainframe computers to reduce prices by 20%. This is an example of

Of the following years, in which was the U.S. unemployment rate the highest?

The productivity of workers is defined as the

Related to the Economics in Practice on p. 127: In the U.S. from 1955 to 1996, the labor force participation rate increased for and decreased for .

The type of unemployment most closely related to recessions is cyclical unemployment.

Unemployment that occurs during the normal workings of an economy as people change jobs and move across the country is called

Related to the Economics in Practice on p. 128: Compared to students who graduate college and obtain employment during an economic expansion, students who graduate during a recession often find that starting wages are and wage growth is .

When the Fed increases the rate of growth of the money supply to jump start the economy, the unemployment type that will be directly affected is the

Refer to the information provided in Table 7.6 below to answer the questions that follow. Table 7.6 -Refer to Table 7.6. If 2015 is the base year, the price index in 2016 is

The number of tools or machines each worker has to work with measures the

An auto worker in Ohio who loses her job because the company relocated the plant to another country represents an example of

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Introduction to Macroeconomics

Measuring National Output and National Income

Aggregate Expenditure and Equilibrium Output

The Government and Fiscal Policy

Money, the Federal Reserve, and the Interest Rate

The Determination of Aggregate Output, the Price Level, and the Interest Rate

Policy Effects and Cost Shocks in the Asad Model

The Labor Market in the Macroeconomy

Financial Crises, Stabilization, and Deficits

Household and Firm Behavior in the Macroeconomy: a Further Look

Long-Run Growth

Alternative Views in Macroeconomics

International Trade, Comparative Advantage, and Protectionism

Open-Economy Macroeconomics: the Balance of Payments and Exchange Rates

Economic Growth in Developing Economies

Critical Thinking About Research

Filters

Exam 7: Unemployment, Inflation, and Long-Run Growth

Which of the following is a desirable characteristic in an economy?

The actual real rate of interest is the nominal rate less the actual inflation rate.

The per-hour output produced by a worker describes the

Output in an economy can be decreased by

Anyone 16 years of age or older who is not classified as employed is still a member of the labor force.

Which of the following statements is true?

Tony has just graduated from college and has now applied for a full time position where he is currently working part-time. This causes the unemployment rate to ________ and the labor-force participation rate to ________.

Refer to the information provided in Table 7.5 below to answer the questions that follow. Table 7.5 -Refer to Table 7.5. Suppose 2015 is the base year. The price index in 2014 is

The decrease in the demand for mainframe computers caused manufacturers of mainframe computers to reduce prices by 20%. This is an example of

Of the following years, in which was the U.S. unemployment rate the highest?

The productivity of workers is defined as the

Related to the Economics in Practice on p. 127: In the U.S. from 1955 to 1996, the labor force participation rate increased for ________ and decreased for ________.

The type of unemployment most closely related to recessions is cyclical unemployment.

Unemployment that occurs during the normal workings of an economy as people change jobs and move across the country is called

Related to the Economics in Practice on p. 128: Compared to students who graduate college and obtain employment during an economic expansion, students who graduate during a recession often find that starting wages are ________ and wage growth is ________.

When the Fed increases the rate of growth of the money supply to jump start the economy, the unemployment type that will be directly affected is the

Refer to the information provided in Table 7.6 below to answer the questions that follow. Table 7.6 -Refer to Table 7.6. If 2015 is the base year, the price index in 2016 is

The number of tools or machines each worker has to work with measures the

An auto worker in Ohio who loses her job because the company relocated the plant to another country represents an example of

The Scope and Method of Economics

The Economic Problem: Scarcity and Choice

Demand, Supply, and Market Equilibrium

Demand and Supply Applications

Introduction to Macroeconomics

Measuring National Output and National Income

Aggregate Expenditure and Equilibrium Output

The Government and Fiscal Policy

Money, the Federal Reserve, and the Interest Rate

The Determination of Aggregate Output, the Price Level, and the Interest Rate

Policy Effects and Cost Shocks in the Asad Model

The Labor Market in the Macroeconomy

Financial Crises, Stabilization, and Deficits

Household and Firm Behavior in the Macroeconomy: a Further Look

Long-Run Growth

Alternative Views in Macroeconomics

International Trade, Comparative Advantage, and Protectionism

Open-Economy Macroeconomics: the Balance of Payments and Exchange Rates

Economic Growth in Developing Economies

Critical Thinking About Research

Filters

Tony has just graduated from college and has now applied for a full time position where he is currently working part-time. This causes the unemployment rate to and the labor-force participation rate to .

Related to the Economics in Practice on p. 127: In the U.S. from 1955 to 1996, the labor force participation rate increased for and decreased for .

Related to the Economics in Practice on p. 128: Compared to students who graduate college and obtain employment during an economic expansion, students who graduate during a recession often find that starting wages are and wage growth is .