Question 1

Which of the following individuals is considered officially unemployed?

Accepted Answer

A) an individual who quits their job to look for a better paying job 
B) an individual who quits his job to raise a child 
C) a discouraged worker 
D) an individual who is not looking for a job because he works in the underground economy 
A) an individual who quits their job to look for a better paying job 
B) an individual who quits his job to raise a child 
C) a discouraged worker 
D) an individual who is not looking for a job because he works in the underground economy

Question 2

If the population older than 16 years of age equals 150 million,the labour force equals 110 million,and the total number of persons employed equals 98 million,then what is the unemployment rate?

Accepted Answer

A) 8 percent 
B) 10.9 percent 
C) 28 percent 
D) 38 percent 
A) 8 percent 
B) 10.9 percent 
C) 28 percent 
D) 38 percent

Question 3

How is the CPI constructed?

Accepted Answer

A) by multiplying the current-year value of a market basket by the base-year value of the same market basket and dividing by 100 
B) by dividing the current-year value of a market basket by the base-year value of the same market basket and multiplying by 100 
C) by dividing the value of a market basket by the rate of inflation 
D) by multiplying the value of a market basket by the rate of inflation 
A) by multiplying the current-year value of a market basket by the base-year value of the same market basket and dividing by 100 
B) by dividing the current-year value of a market basket by the base-year value of the same market basket and multiplying by 100 
C) by dividing the value of a market basket by the rate of inflation 
D) by multiplying the value of a market basket by the rate of inflation

Question 4

What government institution is responsible for calculating the Consumer Price Index?

Accepted Answer

A) Statistics Canada 
B) Bank of Canada 
C) Canadian Price Stability Commission 
D) Department of Finance 
A) Statistics Canada 
B) Bank of Canada 
C) Canadian Price Stability Commission 
D) Department of Finance

Question 5

Which of the following statements most accurately describes underemployment?

Accepted Answer

A) People are underemployed when they first enter the job market. 
B) People are underemployed if they lose their job because of a recession. 
C) People are underemployed when they make less money than someone doing a similar job. 
D) People are underemployed if their skills are greater than are necessary for their jobs. 
A) People are underemployed when they first enter the job market. 
B) People are underemployed if they lose their job because of a recession. 
C) People are underemployed when they make less money than someone doing a similar job. 
D) People are underemployed if their skills are greater than are necessary for their jobs.

Question 6

How is the CPI constructed?

Accepted Answer

A) using a basket of goods and services that includes every item included in the nation's GDP 
B) using a basket of goods containing an assortment of raw materials, intermediate goods, and final goods 
C) using a basket of goods and services purchased by a typical urban consumer 
D) using a basket of intermediate goods purchased by a typical business to use in the production process 
A) using a basket of goods and services that includes every item included in the nation's GDP 
B) using a basket of goods containing an assortment of raw materials, intermediate goods, and final goods 
C) using a basket of goods and services purchased by a typical urban consumer 
D) using a basket of intermediate goods purchased by a typical business to use in the production process

Question 7

A business cycle lasts exactly one year.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following will result if a nation's labour force receives a significant influx of young workers?

Accepted Answer

A) Frictional unemployment will likely decrease to zero. 
B) The natural rate of unemployment is likely to increase. 
C) The natural rate of unemployment is likely to decrease. 
D) The natural rate of unemployment is unlikely to change. 
A) Frictional unemployment will likely decrease to zero. 
B) The natural rate of unemployment is likely to increase. 
C) The natural rate of unemployment is likely to decrease. 
D) The natural rate of unemployment is unlikely to change.

Question 9

When an office worker loses his job because he lacks the computer skills the employer requires,he becomes frictionally unemployed.

Accepted Answer

A) True 
 B)False

Question 10

What is frictional unemployment?

Accepted Answer

A) unemployment caused by automation in the workplace 
B) unemployment that is due to normal turnover in the labour market 
C) unemployment caused by lack of training and education 
D) unemployment that is due to the friction of competing ideological systems 
A) unemployment caused by automation in the workplace 
B) unemployment that is due to normal turnover in the labour market 
C) unemployment caused by lack of training and education 
D) unemployment that is due to the friction of competing ideological systems

Question 11

What will make inflation less harmful?

Accepted Answer

A) if worker wages are set by long-term contracts 
B) if it is correctly anticipated and interest rates adjust accordingly 
C) if worker wages increase at the same rate as real growth 
D) if interest rates are not adjusted accordingly when inflation occurs 
A) if worker wages are set by long-term contracts 
B) if it is correctly anticipated and interest rates adjust accordingly 
C) if worker wages increase at the same rate as real growth 
D) if interest rates are not adjusted accordingly when inflation occurs

Question 12

For any given year,how is the CPI calculated?

Accepted Answer

A) the price of the basket of goods and services in the given year divided by the price of the basket in the base year, then multiplied by 100 
B) the price of the basket of goods and services in the base year divided by the price of the basket in the given year, then divided by 100 
C) the price of the basket of goods and services in the given year multiplied by the price of the basket in the base year, then divided by 100 
D) the price of the basket of goods and services in the base year divided by the price of the basket in the given year, then multiplied by 100 
A) the price of the basket of goods and services in the given year divided by the price of the basket in the base year, then multiplied by 100 
B) the price of the basket of goods and services in the base year divided by the price of the basket in the given year, then divided by 100 
C) the price of the basket of goods and services in the given year multiplied by the price of the basket in the base year, then divided by 100 
D) the price of the basket of goods and services in the base year divided by the price of the basket in the given year, then multiplied by 100

Question 13

Which of the following is NOT a reason as to why the CPI may be biased?

Accepted Answer

A) The CPI deals with a fixed market basket and doesn't capture the savings households enjoy when they take advantage of sales. 
B) The CPI does not pick up the increase in economic welfare caused by new products entering the marketplace. 
C) The CPI does not adequately deal with changes in the quantity of products purchased over time. 
D) The CPI does not adequately reflect that different consumers have different tastes. 
A) The CPI deals with a fixed market basket and doesn't capture the savings households enjoy when they take advantage of sales. 
B) The CPI does not pick up the increase in economic welfare caused by new products entering the marketplace. 
C) The CPI does not adequately deal with changes in the quantity of products purchased over time. 
D) The CPI does not adequately reflect that different consumers have different tastes.

Question 14

If,over time,a greater proportion of the labour force is comprised of middle-aged individuals,one would expect the natural rate of unemployment to rise.

Accepted Answer

A) True 
 B)False

Question 15

What are the four phases of the classical business cycle and how is employment typically affected during each phase?

Accepted Answer

The four phases of the business cycle ar

Question 16

Economic growth refers to an increase in nominal output of goods and services in an economy.

Accepted Answer

A) True 
 B)False

Question 17

The current cost of a market basket of goods is $800.The cost of the same basket of goods in the base year was $1000.What is the current price index?

Accepted Answer

A) -20 
B) 80 
C) 100 
D) 120 
A) -20 
B) 80 
C) 100 
D) 120

Question 18

What is the unemployment rate in a town in which 65 400 persons are employed and 11 000 are unemployed?

Accepted Answer

A) 11 percent 
B) 14.4 percent 
C) 16.8 percent 
D) 20.2 percent 
A) 11 percent 
B) 14.4 percent 
C) 16.8 percent 
D) 20.2 percent

Question 19

Why might the official unemployment rate NOT reflect the true state of unemployment?

Accepted Answer

A) Some individuals who want to work may become discouraged and cease actively looking for work. 
B) Part-time employees are counted as unemployed. 
C) Retired workers are considered unemployed. 
D) Workers who are laid off from their jobs but looking for new ones are not counted among the unemployed. 
A) Some individuals who want to work may become discouraged and cease actively looking for work. 
B) Part-time employees are counted as unemployed. 
C) Retired workers are considered unemployed. 
D) Workers who are laid off from their jobs but looking for new ones are not counted among the unemployed.

Question 20

Why do some critics assert that the unemployment rate understates the unemployment problem?

Accepted Answer

A) A jobless person can claim to be looking for work even if he or she is not really interested in employment. 
B) Involuntary part-time workers and discouraged workers are not included in unemployment statistics. 
C) Labour unions may not cooperate fully in providing reliable unemployment information to Statistics Canada. 
D) Workers temporarily laid off are included in the unemployment statistics. 
A) A jobless person can claim to be looking for work even if he or she is not really interested in employment. 
B) Involuntary part-time workers and discouraged workers are not included in unemployment statistics. 
C) Labour unions may not cooperate fully in providing reliable unemployment information to Statistics Canada. 
D) Workers temporarily laid off are included in the unemployment statistics.

Which of the following individuals is considered officially unemployed?

If the population older than 16 years of age equals 150 million,the labour force equals 110 million,and the total number of persons employed equals 98 million,then what is the unemployment rate?

How is the CPI constructed?

What government institution is responsible for calculating the Consumer Price Index?

Which of the following statements most accurately describes underemployment?

How is the CPI constructed?

A business cycle lasts exactly one year.

Which of the following will result if a nation's labour force receives a significant influx of young workers?

When an office worker loses his job because he lacks the computer skills the employer requires,he becomes frictionally unemployed.

What is frictional unemployment?

What will make inflation less harmful?

For any given year,how is the CPI calculated?

Which of the following is NOT a reason as to why the CPI may be biased?

If,over time,a greater proportion of the labour force is comprised of middle-aged individuals,one would expect the natural rate of unemployment to rise.

What are the four phases of the classical business cycle and how is employment typically affected during each phase?

Economic growth refers to an increase in nominal output of goods and services in an economy.

The current cost of a market basket of goods is $800.The cost of the same basket of goods in the base year was $1000.What is the current price index?

What is the unemployment rate in a town in which 65 400 persons are employed and 11 000 are unemployed?

Why might the official unemployment rate NOT reflect the true state of unemployment?

Why do some critics assert that the unemployment rate understates the unemployment problem?

The Role and Method of Economics

Scarcity, trade-Offs, and Production Possibilities

Supply and Demand

Bringing Supply and Demand Together

Measuring Economic Performance

Economic Growth in the Global Economy

Aggregate Demand

Aggregate Supply and Macroeconomic Equilibrium

Fiscal Policy

Money and the Banking System

The Bank of Canada

Monetary Policy

International Trade

International Finance

Filters

Exam 5: Introduction to the Macroeconomy

Which of the following individuals is considered officially unemployed?

If the population older than 16 years of age equals 150 million,the labour force equals 110 million,and the total number of persons employed equals 98 million,then what is the unemployment rate?

How is the CPI constructed?

What government institution is responsible for calculating the Consumer Price Index?

Which of the following statements most accurately describes underemployment?

How is the CPI constructed?

A business cycle lasts exactly one year.

Which of the following will result if a nation's labour force receives a significant influx of young workers?

When an office worker loses his job because he lacks the computer skills the employer requires,he becomes frictionally unemployed.

What is frictional unemployment?

What will make inflation less harmful?

For any given year,how is the CPI calculated?

Which of the following is NOT a reason as to why the CPI may be biased?

If,over time,a greater proportion of the labour force is comprised of middle-aged individuals,one would expect the natural rate of unemployment to rise.

What are the four phases of the classical business cycle and how is employment typically affected during each phase?

Economic growth refers to an increase in nominal output of goods and services in an economy.

The current cost of a market basket of goods is $800.The cost of the same basket of goods in the base year was $1000.What is the current price index?

What is the unemployment rate in a town in which 65 400 persons are employed and 11 000 are unemployed?

Why might the official unemployment rate NOT reflect the true state of unemployment?

Why do some critics assert that the unemployment rate understates the unemployment problem?

The Role and Method of Economics

Scarcity, trade-Offs, and Production Possibilities

Supply and Demand

Bringing Supply and Demand Together

Measuring Economic Performance

Economic Growth in the Global Economy

Aggregate Demand

Aggregate Supply and Macroeconomic Equilibrium

Fiscal Policy

Money and the Banking System

The Bank of Canada

Monetary Policy

International Trade

International Finance

Filters