Question 1

To understand why someone cannot get a job,it helps to know the three types of unemployment.List the three types of unemployment and explain what causes each type.What advice for finding a job would be appropriate for someone in each type of unemployment?

Accepted Answer

The answer of To understand why someone cannot get a...

Question 2

Table 20-11
  
Source: Energy Information Administration
-Refer to Table 20-11.The table above reports the consumer price index and the average U.S.retail price for unleaded regular gasoline for four different periods since 1976.Note that the gasoline prices are in cents per gallon.
Calculate the real average retail price of unleaded regular gasoline in 1982-1984 dollars.In which period were gasoline prices the highest in real terms? Also,calculate the real average retail price of unleaded regular gasoline in 2011 dollars.

Accepted Answer

The answer of Table 20-11
  
Source: Energy Information Administration
-Refer...

Question 3

An advantage of the household survey over the establishment survey of the labor market is that the household survey

Accepted Answer

A)  is based on actual payrolls, rather than on unverified answers. 
B)  includes the number of self-employed persons. 
C)  includes the number of discouraged workers. 
D)  omits persons employed at newly opened firms.

Question 4

When deflation occurs,

Accepted Answer

A)  the real interest rate is greater than the nominal interest rate. 
B)  the nominal interest rate is greater than the real interest rate. 
C)  the nominal interest rate is equal to the real interest rate and inflation is negative. 
D)  the nominal interest rate is equal to the real interest rate and inflation is positive.

Question 5

According to the text,economists consider full employment to occur when

Accepted Answer

A)  everyone who wants a job has a job. 
B)  frictional unemployment equals zero. 
C)  the sum of frictional unemployment and structural unemployment equals zero. 
D)  the unemployment rate consists of only frictional and structural unemployment.

Question 6

The natural rate of unemployment consists of frictional unemployment plus structural unemployment.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following would be a consequence of substitution bias in the CPI?

Accepted Answer

A)  Social Security payments would not adequately compensate retired workers for inflation. 
B)  Businesses would over-compensate employees for inflation when giving the cost of living rises. 
C)  The inflation rate based on the CPI would under-estimate the true level of inflation. 
D)  Judges would award child support payments that would not adequately keep up with the true cost of inflation.

Question 8

Discuss the likely impact of each of the following on the unemployment rate:
a.The length of time workers are eligible to receive unemployment insurance payments is cut in half.
b.The government passes a law making labor unions illegal.
c.The minimum wage is raised by 50 percent.
d.The government funds an Internet site where companies can post job openings at no charge.

Accepted Answer

The answer of Discuss the likely impact of each of...

Question 9

Imagine that you borrow $5,000 for one year and at the end of the year you repay the $5,000 plus $600 of interest.If the inflation rate was 4%,what was the real interest rate you paid?

Accepted Answer

A)  16 percent 
B)  12 percent 
C)  8 percent 
D)  6 percent

Question 10

If the federal government implements programs so that the unemployed are more quickly matched with jobs,then

Accepted Answer

A)  the natural rate of unemployment will increase. 
B)  the natural rate of unemployment will decrease. 
C)  the natural rate of unemployment will not change. 
D)  the natural rate of unemployment could either increase or decrease.

Question 11

The inflation rate measures the average prices of goods and services in the economy.

Accepted Answer

A) True 
 B)False

Question 12

Someone who is available for work but has not actively looked for work in the previous four weeks would be classified as

Accepted Answer

A)  employed. 
B)  unemployed. 
C)  not in the labor force. 
D)  not in the working-age population.

Question 13

The unemployment rate in the United States is typically lower than in Western Europe because the United States has tougher requirements for the unemployed to receive government payments.

Accepted Answer

A) True 
 B)False

Question 14

Full employment is not considered to be zero unemployment,because

Accepted Answer

A)  some cyclical unemployment always exists. 
B)  some people do not want a job. 
C)  there are not enough jobs for everyone who wants one. 
D)  people do not find jobs instantaneously.

Question 15

Fill in the missing values in the table of data collected in the household survey for November,2009.The working-age population,employment,unemployment,and labor force are measured in thousands.Show your work.

Accepted Answer

The answer of Fill in the missing values in the...

Question 16

The substitution bias in the consumer price index refers to the idea that consumers ________ the quantity of products they buy in response to price,and the CPI does not reflect this and ________ the cost of the market basket.

Accepted Answer

A)  change; over-estimates 
B)  change; under-estimates 
C)  do not change; over-estimates 
D)  do not change; under-estimates

Question 17

Which of the following statements is true about the U.S.economy?

Accepted Answer

A)  Each year, many new jobs are created, but few existing jobs are destroyed, and the unemployed find jobs quickly. 
B)  Each year, few new jobs are created, but few existing jobs are destroyed, keeping unemployment low. 
C)  Each year, many new jobs are created and many existing jobs are destroyed. 
D)  Each year few jobs are created, and therefore it takes the unemployed a long time to find a new job.

Question 18

Table 20-2
 
-Refer to Table 20-2.Assume the market basket for the consumer price index has two products bread and milk with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals

Accepted Answer

A)  118. 
B)  116. 
C)  86. 
D)  85.

Question 19

Table 20-4
 
-Refer to Table 20-4.Assume the market basket for the consumer price index has two products - meat and potatoes - with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals

Accepted Answer

A)  125. 
B)  129. 
C)  135. 
D)  141.

Question 20

The natural rate of unemployment is the amount of unemployment

Accepted Answer

A)  associated with the business cycle. 
B)  equal to frictional plus structural unemployment. 
C)  that exists when the economy goes into recession. 
D)  that exists when the economy is in an expansion.

Exam 9: Unemployment and Inflation

To understand why someone cannot get a job,it helps to know the three types of unemployment.List the three types of unemployment and explain what causes each type.What advice for finding a job would be appropriate for someone in each type of unemployment?

An advantage of the household survey over the establishment survey of the labor market is that the household survey

When deflation occurs,

According to the text,economists consider full employment to occur when

The natural rate of unemployment consists of frictional unemployment plus structural unemployment.

Which of the following would be a consequence of substitution bias in the CPI?

Imagine that you borrow $5,000 for one year and at the end of the year you repay the $5,000 plus $600 of interest.If the inflation rate was 4%,what was the real interest rate you paid?

If the federal government implements programs so that the unemployed are more quickly matched with jobs,then

The inflation rate measures the average prices of goods and services in the economy.

Someone who is available for work but has not actively looked for work in the previous four weeks would be classified as

The unemployment rate in the United States is typically lower than in Western Europe because the United States has tougher requirements for the unemployed to receive government payments.

Full employment is not considered to be zero unemployment,because

Fill in the missing values in the table of data collected in the household survey for November,2009.The working-age population,employment,unemployment,and labor force are measured in thousands.Show your work.

The substitution bias in the consumer price index refers to the idea that consumers the quantity of products they buy in response to price,and the CPI does not reflect this and the cost of the market basket.

Which of the following statements is true about the U.S.economy?

Table 20-2 -Refer to Table 20-2.Assume the market basket for the consumer price index has two products bread and milk with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals

Table 20-4 -Refer to Table 20-4.Assume the market basket for the consumer price index has two products - meat and potatoes - with the following values in 2006 and 2011 for price and quantity: The Consumer Price Index for 2011 equals

The natural rate of unemployment is the amount of unemployment