Question 1

In the DMP model,a decrease in the unemployment insurance benefit

Accepted Answer

A)  increases the unemployment rate. 
B)  reduces labor market tightness. 
C)  reduces the unemployment rate. 
D)  reduces the vacancy rate. 
A)  increases the unemployment rate. 
B)  reduces labor market tightness. 
C)  reduces the unemployment rate. 
D)  reduces the vacancy rate. C

Question 2

In the Keynesian DMP model

Accepted Answer

A)  There is a fiscal multiplier. 
B)  The government post vacancies in the labor market. 
C)  There is no unemployment. 
D)  There can be more than one wage consistent with equilibrium. 
A)  There is a fiscal multiplier. 
B)  The government post vacancies in the labor market. 
C)  There is no unemployment. 
D)  There can be more than one wage consistent with equilibrium. D

Question 3

A decrease in matching efficiency

Accepted Answer

A)  can never happen. 
B)  is due to a change in the productivity of firms. 
C)  is not related to sectoral shocks. 
D)  can explain the shift in the Beveridge curve. 
A)  can never happen. 
B)  is due to a change in the productivity of firms. 
C)  is not related to sectoral shocks. 
D)  can explain the shift in the Beveridge curve. D

Question 4

A market failure associated with Keynesian economics is

Accepted Answer

A)  pollution externalities. 
B)  economic agents cannot agree on prices and wages that are socially efficient. 
C)  insurance is imperfect. 
D)  banking panics. 
A)  pollution externalities. 
B)  economic agents cannot agree on prices and wages that are socially efficient. 
C)  insurance is imperfect. 
D)  banking panics.

Question 5

If N is the working-age population,Q is the labor force,and U is the number of unemployed,then the employment/population ratio is measured as

Accepted Answer

A)  N/Q 
B)  U/Q 
C)  (Q-U)/N 
D)  Q/N 
A)  N/Q 
B)  U/Q 
C)  (Q-U)/N 
D)  Q/N

Question 6

From 2009 to 2012

Accepted Answer

A)  The Beveridge curve became flat. 
B)  The Beveridge curve shifted to the right. 
C)  The Beveridge curve cannot be discerned in the data. 
D)  The Beveridge curve shifted to the left. 
A)  The Beveridge curve became flat. 
B)  The Beveridge curve shifted to the right. 
C)  The Beveridge curve cannot be discerned in the data. 
D)  The Beveridge curve shifted to the left.

Question 7

The matching function exhibits all of the following properties except

Accepted Answer

A)  diminishing marginal product of labor. 
B)  constant returns to scale. 
C)  increasing in matching efficiency. 
D)  increasing in inputs of searching consumers and firms. 
A)  diminishing marginal product of labor. 
B)  constant returns to scale. 
C)  increasing in matching efficiency. 
D)  increasing in inputs of searching consumers and firms.

Question 8

In the DMP model,

Accepted Answer

A)  Firms maximize profits. 
B)  Firms determine how much effort they should put into filling job vacancies. 
C)  Firms decide whether or not to enter the labor market by posting vacancies. 
D)  Firms decide whether or not to retain or fire workers. 
A)  Firms maximize profits. 
B)  Firms determine how much effort they should put into filling job vacancies. 
C)  Firms decide whether or not to enter the labor market by posting vacancies. 
D)  Firms decide whether or not to retain or fire workers.

Question 9

If A is the number of job vacancies in the aggregate,Q is the labor force,and U is the number of unemployed,then the vacancy rate is measured by

Accepted Answer

A)  A/(A+Q-U) 
B)  A/(Q 
C)  A/(A+Q+U) 
D)  U/(A+Q-U) 
A)  A/(A+Q-U) 
B)  A/(Q 
C)  A/(A+Q+U) 
D)  U/(A+Q-U)

Question 10

The negative correlation between the vacancy rate and the unemployment rate is called

Accepted Answer

A)  The Laffer curve. 
B)  The Phillips curve. 
C)  The Fisher relation. 
D)  The Beveridge curve. 
A)  The Laffer curve. 
B)  The Phillips curve. 
C)  The Fisher relation. 
D)  The Beveridge curve.

Question 11

The average unemployment rate was lowest during what period?

Accepted Answer

A)  1980-1990 
B)  1950-1970 
C)  2000-2010 
D)  1980-2000 
A)  1980-1990 
B)  1950-1970 
C)  2000-2010 
D)  1980-2000

Question 12

In the Keynesian DMP model,if the wage is high then

Accepted Answer

A)  the vacancy rate is low. 
B)  the unemployment rate is low. 
C)  labor market tightness is high. 
D)  the labor force must be low. 
A)  the vacancy rate is low. 
B)  the unemployment rate is low. 
C)  labor market tightness is high. 
D)  the labor force must be low.

Question 13

In the DMP model,a decrease in matching efficiency

Accepted Answer

A)  has no effect on vacancies. 
B)  reduces the unemployment rate. 
C)  increases labor market tightness. 
D)  increases the size of the labor force. 
A)  has no effect on vacancies. 
B)  reduces the unemployment rate. 
C)  increases labor market tightness. 
D)  increases the size of the labor force.

Question 14

The employment/population ratio is

Accepted Answer

A)  more volatile than the participation rate. 
B)  roughly constant over time. 
C)  less volatile than the participation rate. 
D)  smaller in 2012 than in 1970. 
A)  more volatile than the participation rate. 
B)  roughly constant over time. 
C)  less volatile than the participation rate. 
D)  smaller in 2012 than in 1970.

Question 15

The participation rate is

Accepted Answer

A)  countercyclical 
B)  more variable than GDP 
C)  procyclical 
D)  a leading variable 
A)  countercyclical 
B)  more variable than GDP 
C)  procyclical 
D)  a leading variable

Question 16

In the DMP model,

Accepted Answer

A)  There are N firms, Q is the labor force, and N-Q is the vacancy rate. 
B)  There are N consumers, Q is the labor force, and N+Q is the number of consumers choosing home production. 
C)  There are Q consumers, N is the labor force, and N-Q is the number of consumers choosing home production. 
D)  There are N consumers, Q is the labor force, and N-Q is the number of consumers choosing home production. 
A)  There are N firms, Q is the labor force, and N-Q is the vacancy rate. 
B)  There are N consumers, Q is the labor force, and N+Q is the number of consumers choosing home production. 
C)  There are Q consumers, N is the labor force, and N-Q is the number of consumers choosing home production. 
D)  There are N consumers, Q is the labor force, and N-Q is the number of consumers choosing home production.

Question 17

The unemployment rate is

Accepted Answer

A)  countercyclical 
B)  procyclical 
C)  a leading variable 
D)  smooth 
A)  countercyclical 
B)  procyclical 
C)  a leading variable 
D)  smooth

Question 18

In the DMP model,an increase in productivity does not

Accepted Answer

A)  reduce the unemployment rate. 
B)  increase the vacancy rate. 
C)  increase labor market tightness. 
D)  increase the size of the labor force. 
A)  reduce the unemployment rate. 
B)  increase the vacancy rate. 
C)  increase labor market tightness. 
D)  increase the size of the labor force.

Question 19

An important feature of the DMP model is that

Accepted Answer

A)  would-be workers care not just about the market wage, but about the chances of finding work. 
B)  firms can fire workers. 
C)  workers can choose to shirk on the job. 
D)  firms maximize revenue. 
A)  would-be workers care not just about the market wage, but about the chances of finding work. 
B)  firms can fire workers. 
C)  workers can choose to shirk on the job. 
D)  firms maximize revenue.

Question 20

The matching function captures the idea that

Accepted Answer

A)  consumers have to be paid to work. 
B)  supply and demand for labor determine the market wage. 
C)  it is costly and time-consuming to get firms and workers together to produce output. 
D)  firms are profit-maximizing. 
A)  consumers have to be paid to work. 
B)  supply and demand for labor determine the market wage. 
C)  it is costly and time-consuming to get firms and workers together to produce output. 
D)  firms are profit-maximizing.

In the DMP model,a decrease in the unemployment insurance benefit

In the Keynesian DMP model

A decrease in matching efficiency

A market failure associated with Keynesian economics is

If N is the working-age population,Q is the labor force,and U is the number of unemployed,then the employment/population ratio is measured as

From 2009 to 2012

The matching function exhibits all of the following properties except

In the DMP model,

If A is the number of job vacancies in the aggregate,Q is the labor force,and U is the number of unemployed,then the vacancy rate is measured by

The negative correlation between the vacancy rate and the unemployment rate is called

The average unemployment rate was lowest during what period?

In the Keynesian DMP model,if the wage is high then

In the DMP model,a decrease in matching efficiency

The employment/population ratio is

The participation rate is

In the DMP model,

The unemployment rate is

In the DMP model,an increase in productivity does not

An important feature of the DMP model is that

The matching function captures the idea that

Introduction

Measurement

Business Cycle Measurement

Consumer and Firm Behavior: The Work-Leisure Decision and Profit Maximization

A Closed-Economy One-Period Macroeconomic Model

Economic Growth: Malthus and Solow

Income Disparity Among Countries and Endogenous Growth

A Two-Period Model: The Consumption-Savings Decision and Credit Markets

Credit Market Imperfections: Credit Frictions, Financial Crises, and Social Security

A Real Intertemporal Model with Investment

Money, Banking, Prices, and Monetary Policy

Business Cycle Models with Flexible Prices and Wages

New Keynesian Economics: Sticky Prices

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking

Inflation, the Phillips Curve, and Central Bank Commitment

Filters

Exam 6: Search and Unemployment

In the DMP model,a decrease in the unemployment insurance benefit

In the Keynesian DMP model

A decrease in matching efficiency

A market failure associated with Keynesian economics is

If N is the working-age population,Q is the labor force,and U is the number of unemployed,then the employment/population ratio is measured as

From 2009 to 2012

The matching function exhibits all of the following properties except

In the DMP model,

If A is the number of job vacancies in the aggregate,Q is the labor force,and U is the number of unemployed,then the vacancy rate is measured by

The negative correlation between the vacancy rate and the unemployment rate is called

The average unemployment rate was lowest during what period?

In the Keynesian DMP model,if the wage is high then

In the DMP model,a decrease in matching efficiency

The employment/population ratio is

The participation rate is

In the DMP model,

The unemployment rate is

In the DMP model,an increase in productivity does not

An important feature of the DMP model is that

The matching function captures the idea that

Introduction

Measurement

Business Cycle Measurement

Consumer and Firm Behavior: The Work-Leisure Decision and Profit Maximization

A Closed-Economy One-Period Macroeconomic Model

Economic Growth: Malthus and Solow

Income Disparity Among Countries and Endogenous Growth

A Two-Period Model: The Consumption-Savings Decision and Credit Markets

Credit Market Imperfections: Credit Frictions, Financial Crises, and Social Security

A Real Intertemporal Model with Investment

Money, Banking, Prices, and Monetary Policy

Business Cycle Models with Flexible Prices and Wages

New Keynesian Economics: Sticky Prices

International Trade in Goods and Assets

Money in the Open Economy

Money, Inflation, and Banking

Inflation, the Phillips Curve, and Central Bank Commitment

Filters