Question 1

Exhibit 6-2
  
-Refer to Exhibit 6-2.How many people are unemployed in year 2?

Accepted Answer

A)  200 million 
B)  50 million 
C)  75 million 
D)  175 million 
E)  100 million 
A)  200 million 
B)  50 million 
C)  75 million 
D)  175 million 
E)  100 million

Question 2

Which of the following statements is true?

Accepted Answer

A)  Base year prices are necessarily higher than current year prices. 
B)  The CPI in the base year is 100. 
C)  If the CPI is 112 in year 1 and 123 in year 2, prices have risen by approximately 9.8 percent between the two years. 
D)  b and c 
E)  a, b, and c 
A)  Base year prices are necessarily higher than current year prices. 
B)  The CPI in the base year is 100. 
C)  If the CPI is 112 in year 1 and 123 in year 2, prices have risen by approximately 9.8 percent between the two years. 
D)  b and c 
E)  a, b, and c

Question 3

A person is unemployed if he

Accepted Answer

A)  is a member of the civilian labor force, out of work, and actively seeking work. 
B)  is 15 years old and seeking his first job. 
C)  is out of work, available for work, but not actively seeking work. 
D)  all of the above 
A)  is a member of the civilian labor force, out of work, and actively seeking work. 
B)  is 15 years old and seeking his first job. 
C)  is out of work, available for work, but not actively seeking work. 
D)  all of the above

Question 4

Suppose that 1982 is the base year for the Consumer Price Index (CPI)and in 2007 the CPI was 190.What does this "190" mean?

Accepted Answer

A)  What cost $100 in 1982 on average cost 190 times as much in 2007. 
B)  What cost $100 in 1982 on average cost $190 in 2007. 
C)  What cost $100 in 1982 on average cost 0.19 times as much in 2007 (that is, it cost $19 in 2007). 
D)  What cost $100 in 1982 on average cost $19 more in 2007. 
A)  What cost $100 in 1982 on average cost 190 times as much in 2007. 
B)  What cost $100 in 1982 on average cost $190 in 2007. 
C)  What cost $100 in 1982 on average cost 0.19 times as much in 2007 (that is, it cost $19 in 2007). 
D)  What cost $100 in 1982 on average cost $19 more in 2007.

Question 5

Look at the following data: The structural unemployment rate is 4 percent,the natural unemployment rate is 5 percent,and the cyclical unemployment rate is 3 percent. The frictional unemployment rate is ____________ percent and the actual unemployment rate is __________ percent.

Accepted Answer

A)  2; 7 
B)  2; 8 
C)  1; 7 
D)  1; 8 
A)  2; 7 
B)  2; 8 
C)  1; 7 
D)  1; 8

Question 6

Describe what the unemployment rate and the employment rate measure. If we were to sum the unemployment rate and the employment rate,would that sum be equal to one hundred percent? Explain why or why not.

Accepted Answer

The unemployment rate measures the perce

Question 7

If the unemployment rate drops,then it necessarily follows that some of the people who were once unemployed are now employed.

Accepted Answer

A) True 
 B)False

Question 8

Of all the categories of unemployment,most unemployed persons fall into the category of

Accepted Answer

A)  reentrant. 
B)  new entrant. 
C)  job leaver. 
D)  job loser. 
E)  none of the above 
A)  reentrant. 
B)  new entrant. 
C)  job leaver. 
D)  job loser. 
E)  none of the above

Question 9

Suppose the civilian non-institutional population equals 250,000; there are 132,500 employed persons and 10,000 unemployed persons.How many people are not in the labor force?

Accepted Answer

A)  122,500 
B)  77,500 
C)  63,500 
D)  107,500 
A)  122,500 
B)  77,500 
C)  63,500 
D)  107,500

Question 10

In year 1 the CPI is 140,and in year 2 the CPI is 160.From year 1 to year 2,Chiang's salary rises from $42,000 to $47,000,and Marta's salary rises from $55,000 to $66,000.Who is "more than keeping up with inflation"?

Accepted Answer

A)  Marta 
B)  Chiang 
C)  both Marta and Chiang 
D)  neither Marta nor Chiang 
A)  Marta 
B)  Chiang 
C)  both Marta and Chiang 
D)  neither Marta nor Chiang

Question 11

Suppose there are 65 million employed persons,5 million unemployed persons,and 35 million persons not in the labor force. What does the civilian noninstitutional population equal?

Accepted Answer

A)  70 million 
B)  110 million 
C)  65 million 
D)  105 million 
A)  70 million 
B)  110 million 
C)  65 million 
D)  105 million

Question 12

The CPI is based on a representative group of goods called the market basket.

Accepted Answer

A) True 
 B)False

Question 13

If the CPI is 220 and nominal income is $37,000,approximately what does real income equal?

Accepted Answer

A)  $81,400 
B)  $16,818 
C)  $76,500 
D)  $44,118 
A)  $81,400 
B)  $16,818 
C)  $76,500 
D)  $44,118

Question 14

Exhibit 6-1
  
-Refer to Exhibit 6-1.Prices rose by approximately __________ percent from Year 1 to Year 5.

Accepted Answer

A)  10.6 
B)  9.6 
C)  14.3 
D)  4.5 
A)  10.6 
B)  9.6 
C)  14.3 
D)  4.5

Question 15

The employment rate equals the number of

Accepted Answer

A)  employed persons divided by the number of unemployed persons. 
B)  unemployed persons divided by the civilian non-institutional population. 
C)  employed persons divided by the civilian labor force. 
D)  employed persons divided by the civilian non-institutional population. 
E)  none of the above 
A)  employed persons divided by the number of unemployed persons. 
B)  unemployed persons divided by the civilian non-institutional population. 
C)  employed persons divided by the civilian labor force. 
D)  employed persons divided by the civilian non-institutional population. 
E)  none of the above

Question 16

Exhibit 6-2
  
-In an economy with a population of 100 million persons,40 million hold civilian jobs and 9 million are not working but are looking for jobs.The number counted as unemployed is

Accepted Answer

A)  91 million. 
B)  9 million. 
C)  51 million. 
D)  40 million. 
E)  49 million. 
A)  91 million. 
B)  9 million. 
C)  51 million. 
D)  40 million. 
E)  49 million.

Question 17

Look at the following data: The frictional unemployment rate is 3 percent,the natural unemployment rate is 6.5 percent,and the cyclical unemployment rate is 2.4 percent.The structural unemployment rate is __________ percent and the actual unemployment rate (in this economy)is __________ percent.

Accepted Answer

A)  3; 8.9 
B)  3.5; 8.9 
C)  3.5; 9.5 
D)  5.4; 2.4 
E)  none of the above 
A)  3; 8.9 
B)  3.5; 8.9 
C)  3.5; 9.5 
D)  5.4; 2.4 
E)  none of the above

Question 18

If a person worked at least 15 hours per week as an "unpaid" worker on a family farm,how is she classified?

Accepted Answer

A)  as not in the labor force 
B)  as an unemployed person 
C)  as an employed person 
D)  none of the above 
A)  as not in the labor force 
B)  as an unemployed person 
C)  as an employed person 
D)  none of the above

Question 19

Suppose that 1983 is the base year for the Consumer Price Index (CPI)and in 2008 the CPI was 220.What does this "220" mean?

Accepted Answer

A)  What cost $100 in 1983 on average cost 2.20 times as much in 2008. 
B)  What cost $100 in 1983 on average cost $220 more in 2008. 
C)  What cost $100 in 1983 on average cost 0.22 times as much in 2008 (that is, it cost $22 in 2008). 
D)  What cost $100 in 1983 on average cost $22 more in 2008. 
A)  What cost $100 in 1983 on average cost 2.20 times as much in 2008. 
B)  What cost $100 in 1983 on average cost $220 more in 2008. 
C)  What cost $100 in 1983 on average cost 0.22 times as much in 2008 (that is, it cost $22 in 2008). 
D)  What cost $100 in 1983 on average cost $22 more in 2008.

Question 20

A seamstress who quits her job in Houston and moves to New York where additional seamstresses are needed is said to be frictionally unemployed.

Accepted Answer

A) True 
 B)False

Exam 6: Macroeconomic Measurements: Prices and Unemployment

Exhibit 6-2 -Refer to Exhibit 6-2.How many people are unemployed in year 2?

Which of the following statements is true?

A person is unemployed if he

Suppose that 1982 is the base year for the Consumer Price Index (CPI)and in 2007 the CPI was 190.What does this "190" mean?

Look at the following data: The structural unemployment rate is 4 percent,the natural unemployment rate is 5 percent,and the cyclical unemployment rate is 3 percent. The frictional unemployment rate is ____________ percent and the actual unemployment rate is __________ percent.

Describe what the unemployment rate and the employment rate measure. If we were to sum the unemployment rate and the employment rate,would that sum be equal to one hundred percent? Explain why or why not.

If the unemployment rate drops,then it necessarily follows that some of the people who were once unemployed are now employed.

Of all the categories of unemployment,most unemployed persons fall into the category of

Suppose the civilian non-institutional population equals 250,000; there are 132,500 employed persons and 10,000 unemployed persons.How many people are not in the labor force?

In year 1 the CPI is 140,and in year 2 the CPI is 160.From year 1 to year 2,Chiang's salary rises from $42,000 to $47,000,and Marta's salary rises from $55,000 to $66,000.Who is "more than keeping up with inflation"?

Suppose there are 65 million employed persons,5 million unemployed persons,and 35 million persons not in the labor force. What does the civilian noninstitutional population equal?

The CPI is based on a representative group of goods called the market basket.

If the CPI is 220 and nominal income is $37,000,approximately what does real income equal?

Exhibit 6-1 -Refer to Exhibit 6-1.Prices rose by approximately __________ percent from Year 1 to Year 5.

The employment rate equals the number of

Exhibit 6-2 -In an economy with a population of 100 million persons,40 million hold civilian jobs and 9 million are not working but are looking for jobs.The number counted as unemployed is

Look at the following data: The frictional unemployment rate is 3 percent,the natural unemployment rate is 6.5 percent,and the cyclical unemployment rate is 2.4 percent.The structural unemployment rate is __________ percent and the actual unemployment rate (in this economy)is __________ percent.

If a person worked at least 15 hours per week as an "unpaid" worker on a family farm,how is she classified?

Suppose that 1983 is the base year for the Consumer Price Index (CPI)and in 2008 the CPI was 220.What does this "220" mean?

A seamstress who quits her job in Houston and moves to New York where additional seamstresses are needed is said to be frictionally unemployed.

What Economics Is About

Production Possibilities Frontier Framework

Supply and Demand: Theory

Prices: Free, Controlled, and Relative

Supply, Demand, and Price: Applications

Macroeconomic Measurements: GDP and Real GDP

Aggregate Demand and Aggregate Supply

Classical Macroeconomics and the Self Regulating Economy

Keynesian Macroeconomics and Economic Instability: A Critique of the Self-Regulating Economy

Fiscal Policy and the Federal Budget

Money, Banking,and the Financial System

The Federal Reserve System

Money and the Economy

Monetary Policy

Expectations Theory and the Economy

Economic Growth: Resources, Technology, Ideas, and Institutions

The Financial Crisis of 2007-2009

Debates in Macroeconomics Over the Role and Effects of Government

Elasticity

Consumer Choice: Maximizing Utility and Behavioral Economics

Production and Costs

Perfect Competition

Monopoly

Monopolistic Competition, Oligopoly, and Game Theory

Government and Product Markets: Antitrust and Regulation

Factor Markets: With Emphasis on the Labor Market

Wages,Unions,and Labor

The Distribution of Income and Poverty

Interest, Rent, and Profit

Market Failure: Externalities, Public Goods, and Asymmetric Information

Public Choice and Special-Interest-Group Politics

Building Theories to Explain Everyday Life: From Observations to Questions to Theories to Predictions

International Trade

International Finance

Globalization and International Impacts on the Economy

The Economic Case For and Against Government: Five Topics Considered

Stocks, Bonds, Futures, and Options

Agriculture: Problems, Policies, and Unintended Effects

Filters

Look at the following data: The structural unemployment rate is 4 percent,the natural unemployment rate is 5 percent,and the cyclical unemployment rate is 3 percent. The frictional unemployment rate is __ percent and the actual unemployment rate is percent.

Look at the following data: The frictional unemployment rate is 3 percent,the natural unemployment rate is 6.5 percent,and the cyclical unemployment rate is 2.4 percent.The structural unemployment rate is percent and the actual unemployment rate (in this economy)is percent.