Question 1

Suppose the country of Tiny Town experienced frictional unemployment. This frictional unemployment would

Accepted Answer

A)  definitely signal that the country is in a recession. 
B)  signal that the number of discouraged workers is growing. 
C)  be considered a natural occurrence in a growing economy. 
D)  signal that there are more job leavers than job losers. 
A)  definitely signal that the country is in a recession. 
B)  signal that the number of discouraged workers is growing. 
C)  be considered a natural occurrence in a growing economy. 
D)  signal that there are more job leavers than job losers.

Question 2

Explain the difference between frictional and structural unemployment.

Accepted Answer

Frictional unemployment is more short te

Question 3

The table below shows data regarding Germany?s labor market. $$\begin{array} { | c | l | c | l | } 
\hline \text { Year } & \begin{array}{c}
\text { Labor Force } \
\text { (millions) }
\end{array} & \begin{array}{c}
\text { Number of } \
\text { Employed } \
\text { (millions) }
\end{array} & \begin{array}{c}
\text { Population } \
\text { (millions) }
\end{array} \\hline 2006 & 43.7 & 39.01 & 82.3 \
\hline 2007 & 43.7 & 39.06 & 82.2 \
\hline 2008 & 43.6 & 39.8 & 82.1 \
\hline
\end{array}$$ The data show that Germany?s unemployment rate between 2007 and 2008

Accepted Answer

A)  increased. 
B)  stayed the same. 
C)  decreased 
D)  cannot be determined because the population decreased. 
A)  increased. 
B)  stayed the same. 
C)  decreased 
D)  cannot be determined because the population decreased.

Question 4

Suppose the population is 220 million people, the labor force is 150 million people, the number of people employed is 130 million and the working-age population is 175 million people. What is the unemployment rate?

Accepted Answer

A)  15.4 percent 
B)  11.4 percent 
C)  9.0 percent 
D)  13.3 percent 
A)  15.4 percent 
B)  11.4 percent 
C)  9.0 percent 
D)  13.3 percent

Question 5

The Consumer Price Index is a measure of the average of the prices paid by for a fixed basket of consumer goods and services.

Accepted Answer

A)  urban wage earners and clerical workers 
B)  urban consumers 
C)  consumers living in cities with a population greater than 100,000 
D)  all consumers 
A)  urban wage earners and clerical workers 
B)  urban consumers 
C)  consumers living in cities with a population greater than 100,000 
D)  all consumers

Question 6

What is inflation and how is it measured using the Consumer Price Index?

Accepted Answer

The inflation rate is the percentage cha

Question 7

If the CPI this year is 220 and was 200 in last year, the annual inflation rate between the two years is

Accepted Answer

A)  10 percent. 
B)  2 percent. 
C)  20 percent. 
D)  5 percent. 
A)  10 percent. 
B)  2 percent. 
C)  20 percent. 
D)  5 percent.

Question 8

Discouraged workers__________ counted as officially unemployed because they __________.

Accepted Answer

A)  are; are not working 
B)  are not; are not actively seeking work 
C)  are not; are not qualified to work 
D)  are; are still in the labor force 
A)  are; are not working 
B)  are not; are not actively seeking work 
C)  are not; are not qualified to work 
D)  are; are still in the labor force

Question 9

Using the definition of unemployment, which of the following individuals would be unemployed?

Accepted Answer

A)  A full-time student quits school, enters the labor market for the first time, and searches for employment. 
B)  Because of a reduction in the military budget, your next door neighbor loses her job in a plant where nuclear warheads are made and must look for a new job. 
C)  Because of the increased level of automobile imports, an employee of General Motors is laid off but expects to be called back to work soon. 
D)  All of these individuals are unemployed. 
A)  A full-time student quits school, enters the labor market for the first time, and searches for employment. 
B)  Because of a reduction in the military budget, your next door neighbor loses her job in a plant where nuclear warheads are made and must look for a new job. 
C)  Because of the increased level of automobile imports, an employee of General Motors is laid off but expects to be called back to work soon. 
D)  All of these individuals are unemployed.

Question 10

In an economy, 43 million people are employed, 3 million are unemployed, and 4 million are not in the labor force. What is the employment -to-population ratio?

Accepted Answer

A)  92 percent 
B)  6.5 percent 
C)  93 percent 
D)  86 percent 
A)  92 percent 
B)  6.5 percent 
C)  93 percent 
D)  86 percent

Question 11

$$\begin{array} { | l | l | l | l | } 
\hline & \begin{array} { l } 
\text { CPI basket } \
\text { quantity }
\end{array} & 2003 \text { price } & 2011 \text { price } \
\hline \text { DVDs } & 10 \text { discs } & \$ 16 \text { per disc } & \$ 12 \text { per dis } \
\hline \begin{array} { l } 
\text { Bottled } \
\text { water }
\end{array} & 200 \text { bottles } & \$ 1.00 \text { per bottle } & \$ 1.25 \text { per bottle } \
\hline
\end{array}$$
-If 2003 is the reference base period, what is the price index for the CPI basket of goods for 2011 in the above table?

Accepted Answer

A)  102.8 
B)  128.0 
C)  97.3 
D)  zero because the price of CDs fell and the price of water increased 
A)  102.8 
B)  128.0 
C)  97.3 
D)  zero because the price of CDs fell and the price of water increased

Question 12

An individual is structurally unemployed if

Accepted Answer

A)  there is a recession and the individual is laid off. 
B)  the individual wants to work just during certain months of the year. 
C)  the individual lacks marketable job skills because technology has changed. 
D)  the individual quits a job in order to search for a better one. 
A)  there is a recession and the individual is laid off. 
B)  the individual wants to work just during certain months of the year. 
C)  the individual lacks marketable job skills because technology has changed. 
D)  the individual quits a job in order to search for a better one.

Question 13

Full employment means

Accepted Answer

A)  only frictional and structural unemployment exists. 
B)  only cyclical unemployment exists. 
C)  zero unemployment. 
D)  None of the above answers are correct. 
A)  only frictional and structural unemployment exists. 
B)  only cyclical unemployment exists. 
C)  zero unemployment. 
D)  None of the above answers are correct.

Question 14

The total number of people aged 16 years and over who are not institutionalized __________.

Accepted Answer

A)  does not include students 
B)  is the working-age population 
C)  is the labor force 
D)  equals the number of employed plus unemployed 
A)  does not include students 
B)  is the working-age population 
C)  is the labor force 
D)  equals the number of employed plus unemployed

Question 15

Substitution bias in the CPI refers to the fact that the CPI

Accepted Answer

A)  takes no account of the substitution of goods by consumers when relative prices change. 
B)  substitutes relative prices for absolute prices of goods. 
C)  substitutes quality changes whenever they occur without taking account of the cost of the quality changes. 
D)  takes into account the substitution of goods by consumers when relative prices change. 
A)  takes no account of the substitution of goods by consumers when relative prices change. 
B)  substitutes relative prices for absolute prices of goods. 
C)  substitutes quality changes whenever they occur without taking account of the cost of the quality changes. 
D)  takes into account the substitution of goods by consumers when relative prices change.

Question 16

Andrew just lost his job as a corkscrew operator since his company has found a machine to perform his work tasks. Andrew did not have the skills needed to operate the machine. Andrew has searched for a new job for 6 months and continues to search. Therefore, Andrew is considered to be

Accepted Answer

A)  a discouraged worker. 
B)  structurally unemployed. 
C)  cyclically unemployed. 
D)  frictionally unemployed. 
A)  a discouraged worker. 
B)  structurally unemployed. 
C)  cyclically unemployed. 
D)  frictionally unemployed.

Question 17

The natural unemployment rate___________

Accepted Answer

A)  is the unemployment rate at full employment. 
B)  is the unemployment rate when there is no structural unemployment. 
C)  occurs when the unemployment rate is 0 percent. 
D)  is the unemployment rate when there is only cyclical unemployment. 
A)  is the unemployment rate at full employment. 
B)  is the unemployment rate when there is no structural unemployment. 
C)  occurs when the unemployment rate is 0 percent. 
D)  is the unemployment rate when there is only cyclical unemployment.

Question 18

If the CPI is 120, this means that

Accepted Answer

A)  prices are 20 percent higher than in the reference base period. 
B)  the inflation rate must be positive. 
C)  prices are 0.12 times higher than in the reference base period. 
D)  prices are 120 percent higher than in the reference base period. 
A)  prices are 20 percent higher than in the reference base period. 
B)  the inflation rate must be positive. 
C)  prices are 0.12 times higher than in the reference base period. 
D)  prices are 120 percent higher than in the reference base period.

Question 19

When cyclical unemployment increases and other things remain the same, .

Accepted Answer

A)  the amount of structural unemployment decreases 
B)  the amount of frictional unemployment increases 
C)  the natural unemployment rate does not change 
D)  the natural unemployment rate increases 
A)  the amount of structural unemployment decreases 
B)  the amount of frictional unemployment increases 
C)  the natural unemployment rate does not change 
D)  the natural unemployment rate increases

Question 20

$\begin{array}{|l|l|}
\hline \text { Category } & \begin{array}{l}
\text { Number } \
\text { (millions) }
\end{array} \\hline \text { Discouraged workers } & 15 \
\hline \text { Unemployed workers } & 40 \
\hline \text { Employed workers } & 100 \
\hline \text { Population (16 years and over) } & 225 \
\hline
\end{array}$
-In the above table, the working age population is

Accepted Answer

A)  100 million. 
B)  225 million. 
C)  155 million. 
D)  140 million. 
A)  100 million. 
B)  225 million. 
C)  155 million. 
D)  140 million.

Suppose the country of Tiny Town experienced frictional unemployment. This frictional unemployment would

Explain the difference between frictional and structural unemployment.

The table below shows data regarding Germany?s labor market. Year Labor Force (millions) Number of Employed (millions) Population (millions) 2006 43.7 39.01 82.3 2007 43.7 39.06 82.2 2008 43.6 39.8 82.1 The data show that Germany?s unemployment rate between 2007 and 2008

Suppose the population is 220 million people, the labor force is 150 million people, the number of people employed is 130 million and the working-age population is 175 million people. What is the unemployment rate?

The Consumer Price Index is a measure of the average of the prices paid by for a fixed basket of consumer goods and services.

What is inflation and how is it measured using the Consumer Price Index?

If the CPI this year is 220 and was 200 in last year, the annual inflation rate between the two years is

Discouraged workers counted as officially unemployed because they .

Using the definition of unemployment, which of the following individuals would be unemployed?

In an economy, 43 million people are employed, 3 million are unemployed, and 4 million are not in the labor force. What is the employment -to-population ratio?

CPI basket quantity 2003 price 2011 price DVDs 10 discs \ 16 per disc \ 12 per dis Bottled water 200 bottles \ 1.00 per bottle \ 1.25 per bottle -If 2003 is the reference base period, what is the price index for the CPI basket of goods for 2011 in the above table?

An individual is structurally unemployed if

Full employment means

The total number of people aged 16 years and over who are not institutionalized __________.

Substitution bias in the CPI refers to the fact that the CPI

Andrew just lost his job as a corkscrew operator since his company has found a machine to perform his work tasks. Andrew did not have the skills needed to operate the machine. Andrew has searched for a new job for 6 months and continues to search. Therefore, Andrew is considered to be

The natural unemployment rate___________

If the CPI is 120, this means that

When cyclical unemployment increases and other things remain the same, .

Category Number (millions) Discouraged workers 15 Unemployed workers 40 Employed workers 100 Population (16 years and over) 225 -In the above table, the working age population is

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

Exam 5: Monitoring Jobs and Inflation

Suppose the country of Tiny Town experienced frictional unemployment. This frictional unemployment would

Explain the difference between frictional and structural unemployment.

The table below shows data regarding Germany?s labor market. Year Labor Force (millions) Number of Employed (millions) Population (millions) 2006 43.7 39.01 82.3 2007 43.7 39.06 82.2 2008 43.6 39.8 82.1 The data show that Germany?s unemployment rate between 2007 and 2008

Suppose the population is 220 million people, the labor force is 150 million people, the number of people employed is 130 million and the working-age population is 175 million people. What is the unemployment rate?

The Consumer Price Index is a measure of the average of the prices paid by for a fixed basket of consumer goods and services.

What is inflation and how is it measured using the Consumer Price Index?

If the CPI this year is 220 and was 200 in last year, the annual inflation rate between the two years is

Discouraged workers__________ counted as officially unemployed because they __________.

Using the definition of unemployment, which of the following individuals would be unemployed?

In an economy, 43 million people are employed, 3 million are unemployed, and 4 million are not in the labor force. What is the employment -to-population ratio?

CPI basket quantity 2003 price 2011 price DVDs 10 discs \ 16 per disc \ 12 per dis Bottled water 200 bottles \ 1.00 per bottle \ 1.25 per bottle -If 2003 is the reference base period, what is the price index for the CPI basket of goods for 2011 in the above table?

An individual is structurally unemployed if

Full employment means

The total number of people aged 16 years and over who are not institutionalized __________.

Substitution bias in the CPI refers to the fact that the CPI

Andrew just lost his job as a corkscrew operator since his company has found a machine to perform his work tasks. Andrew did not have the skills needed to operate the machine. Andrew has searched for a new job for 6 months and continues to search. Therefore, Andrew is considered to be

The natural unemployment rate___________

If the CPI is 120, this means that

When cyclical unemployment increases and other things remain the same, .

Category Number (millions) Discouraged workers 15 Unemployed workers 40 Employed workers 100 Population (16 years and over) 225 -In the above table, the working age population is

What Is Economics

The Economic Problem

Demand and Supply

Measuring Gdp and Economic Growth

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: the Keynesian Model

U.S Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Review

Filters

Discouraged workers counted as officially unemployed because they .