Question 1

How would the Bureau of Labor Statistics classify a college graduate who is not currently working but recently turned down an offer for employment at $10 an hour in order to keep looking for a better job?

Accepted Answer

A) not in the labor force 
B) employed 
C) unemployed 
D) on temporary absence from school

Question 2

Full employment

Accepted Answer

A) exists when everyone in the economy has a job 
B) exists when everyone who wants a job has one 
C) exists when the unemployment rate is zero 
D) exists when everyone in the labor force has a job 
E) will always include some unemployment

Question 3

Evaluate the economic validity of the following statement: "Unemployed resources would not exist if the economy were operating efficiently."

Accepted Answer

The answer of Evaluate the economic validity of the following...

Question 4

Which one of the following would be classified as employed?

Accepted Answer

A) a parent who works 50 to 60 hours per week caring for family members 
B) an construction worker vacationing in Florida who is on layoff due to bad weather conditions in his home state 
C) a 21-year-old full-time college student 
D) a 17-year-old high school student who works a newspaper route six hours per week

Question 5

Which of the following is most indicative of a recession?

Accepted Answer

A) a decline in unemployment 
B) a rise in inflation 
C) a decline in real GDP 
D) an increase in the interest rate

Question 6

Cyclical unemployment

Accepted Answer

A) is caused by changes in the business cycle. 
B) results from imperfect search activities in matching qualified employees with employers. 
C) results from institutional factors that make it difficult for some workers to find jobs. 
D) will probably go up as a result of improvements in online job searching.

Question 7

During periods of high and variable inflation,which of the following is unlikely to occur?

Accepted Answer

A) Resources will be diverted from economically productive activities toward activities designed to protect individuals from inflation. 
B) Individuals will find it difficult to know whether a price change is due to the general inflation or due to shifts in supply or demand in a given market. 
C) Individuals will want to make long-term contracts in order to enjoy the benefits of higher prices. 
D) Some resources will be wasted as suppliers have to reprint menus and price catalogues to reflect the new,higher prices.

Question 8

Mallory Trammell is a homemaker.Last week,she was busy with her normal household chores.She is

Accepted Answer

A) a member of the civilian labor force who is employed. 
B) a member of the civilian labor force who is unemployed. 
C) a member of the civilian labor force who is underemployed. 
D) a discouraged worker who is not a member of the labor force. 
E) not a member of the labor force.

Question 9

The definition of the unemployment rate is

Accepted Answer

A) the number of persons in the country who are not employed. 
B) the number of persons in the civilian labor force who are not employed. 
C) the percentage of persons in the country who are not employed. 
D) the percentage of persons in the civilian labor force who are not employed.

Question 10

Which of the following about inflation is true?

Accepted Answer

A) High rates of inflation are usually associated with wide year-to-year changes in inflation. 
B) High rates of inflation are usually associated only with very large countries such as the United States. 
C) High rates of inflation are usually associated only with smaller countries such as Costa Rica. 
D) High rates of inflation will generally improve the economic efficiency of an economy.

Question 11

The population (age 16 and over)of Yakutsk is 200 million;9 million are unemployed,and 111 million hold jobs.Indicate the rate of unemployment and the employment/population ratio of Yakutsk.

Accepted Answer

A) The unemployment rate is 4.5 percent,and the employment/population ratio is 55.5 percent. 
B) The unemployment rate is 7.5 percent,and the employment/population ratio is 60 percent. 
C) The unemployment rate is 7.5 percent,and the employment/population ratio is 55.5 percent. 
D) The unemployment rate is 8.1 percent,and the employment/population ratio is 60 percent.

Question 12

Which one of the following persons would be classified as unemployed by the Bureau of Labor Statistics?

Accepted Answer

A) Sean,who is in the midst of a two-week vacation from his regular job 
B) Susan,who is unable to work her regular job this week because of illness 
C) Joe,who is on layoff waiting for better weather so he can return to his construction job 
D) Kim,who is working four hours each week at McDonald's while looking for a full-time job

Question 13

Andrea would be considered unemployed if she is

Accepted Answer

A) working at a part-time job but is looking for a full-time job. 
B) absent from her regular job as the result of illness. 
C) working at a full-time job but is looking for a part-time job. 
D) not working and is looking for a part-time job.

Question 14

The natural rate of unemployment occurs if there is no

Accepted Answer

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

Question 15

Which of the following will most likely cause a decrease the natural rate of unemployment?

Accepted Answer

A) an increase in the minimum wage 
B) an increase in unemployment benefits 
C) an increase in experienced workers aged 25 and over as proportion of the labor force 
D) an increase in the labor force participation rate of teenagers

Question 16

Each month,the Bureau of Labor Statistics calculates unemployment by

Accepted Answer

A) surveying all workers in the economy. 
B) surveying a random sample of households. 
C) making projections based on census data. 
D) surveying large business and government employers.

Question 17

The value of money

Accepted Answer

A) remains constant during periods of inflation. 
B) varies inversely with the general price level. 
C) varies directly with the general price level. 
D) varies indirectly with output.

Question 18

The stages of a business cycle,in order,are

Accepted Answer

A) expansion,contraction,recession,and boom. 
B) contraction,recession,expansion,and boom. 
C) boom,expansion,contraction,and recession. 
D) recession,contraction,expansion,and boom.

Question 19

The reduction of structural unemployment in the United States' economy may require

Accepted Answer

A) an increase in the minimum wage. 
B) a reduction in government spending. 
C) an decrease in interest rates. 
D) increased spending on worker retraining.

Question 20

Economists use the term "business cycle" to refer to

Accepted Answer

A) the growth of small businesses into major corporations. 
B) changes in products that occur from improved technology. 
C) fluctuations in the level of real output and employment. 
D) periods of increases and decreases in the rate of inflation.

Exam 8: Economic Fluctuations, unemployment, and Inflation