Question 1

Which of the following observations concerning phases of a business cycle is incorrect?

Accepted Answer

A) Maximum amount of unemployment occurs exactly at the trough. 
B) Expansion phase is measured from the trough to the peak. 
C) Trough is the point in time when output stops declining. 
D) The contraction phase is also called recession. 
A) Maximum amount of unemployment occurs exactly at the trough. 
B) Expansion phase is measured from the trough to the peak. 
C) Trough is the point in time when output stops declining. 
D) The contraction phase is also called recession. A

Question 2

Which of the following refers to extremely high rates of inflation for sustained periods of time?

Accepted Answer

A) deflation 
B) hyperinflation 
C) bust 
D) depression 
E) expansion 
A) deflation 
B) hyperinflation 
C) bust 
D) depression 
E) expansion B

Question 3

According to Okun's law, a 2 percent increase in cyclical unemployment reduces output by almost:

Accepted Answer

A) 1 percent. 
B) 2 percent. 
C) 0.5 percent 
D) 4 percent. 
A) 1 percent. 
B) 2 percent. 
C) 0.5 percent 
D) 4 percent. D

Question 4

Given a fixed nominal interest rate on a loan, unanticipated inflation:

Accepted Answer

A) decreases the burden of paying off the loan. 
B) increases the burden of paying off the loan. 
C) does not alter the burden of paying off the loan. 
D) benefits savers. 
A) decreases the burden of paying off the loan. 
B) increases the burden of paying off the loan. 
C) does not alter the burden of paying off the loan. 
D) benefits savers.

Question 5

The unemployment rate measures the number of unemployed people expressed as a percentage of the total population.

Accepted Answer

A) True 
 B)False

Question 6

The unemployment rate is defined as:

Accepted Answer

A) unemployed workers plus discouraged workers, divided by the total population over the age of sixteen. 
B) part-time workers plus full-time workers, divided by the total population over the age of sixteen. 
C) the percentage of the labor force that is unemployed. 
D) the percentage of the population over the age of sixteen that is unemployed. 
A) unemployed workers plus discouraged workers, divided by the total population over the age of sixteen. 
B) part-time workers plus full-time workers, divided by the total population over the age of sixteen. 
C) the percentage of the labor force that is unemployed. 
D) the percentage of the population over the age of sixteen that is unemployed.

Question 7

Economists usually use the term "recession" to refer to:

Accepted Answer

A) any slowdown in the growth of real GDP. 
B) zero real GDP growth. 
C) two or more consecutive quarters of declining real GDP. 
D) a significant reduction in output and employment lasting more than a few months. 
A) any slowdown in the growth of real GDP. 
B) zero real GDP growth. 
C) two or more consecutive quarters of declining real GDP. 
D) a significant reduction in output and employment lasting more than a few months.

Question 8

Which piece of legislation committed the government to pursuing unemployment policies that are consistent with maintaining price stability?

Accepted Answer

A) Effective Pricing Act of 1971 
B) Employment Initiative Act of 1998 
C) Employment Act of 1946 
D) Stable Growth Act of 1960 
A) Effective Pricing Act of 1971 
B) Employment Initiative Act of 1998 
C) Employment Act of 1946 
D) Stable Growth Act of 1960

Question 9

The unemployment rate is calculated as:

Accepted Answer

A) the number of unemployed persons divided by the number of employed persons. 
B) the number of employed persons divided by the number of unemployed persons. 
C) the number of unemployed persons divided by the number of employed plus unemployed persons. 
D) the number of unemployed persons divided by the population. 
A) the number of unemployed persons divided by the number of employed persons. 
B) the number of employed persons divided by the number of unemployed persons. 
C) the number of unemployed persons divided by the number of employed plus unemployed persons. 
D) the number of unemployed persons divided by the population.

Question 10

The development of a nationwide computerized job bank listing of all job openings would be most likely to reduce:

Accepted Answer

A) structural unemployment. 
B) frictional unemployment. 
C) seasonal unemployment. 
D) cyclical unemployment. 
A) structural unemployment. 
B) frictional unemployment. 
C) seasonal unemployment. 
D) cyclical unemployment.

Question 11

In 2010, what percentage of the unemployed were out of work for more than 27 weeks?

Accepted Answer

A) 24% 
B) 41% 
C) 49% 
D) 54% 
A) 24% 
B) 41% 
C) 49% 
D) 54%

Question 12

Figure 11-A
Assuming the data in this figure are correct, use the data to answer the following questions.  
-Refer to Figure 11-A.The number of people considered to be out of the labor force is:

Accepted Answer

A) 100 million. 
B) 60 million. 
C) 85 million. 
D) 180 million. 
A) 100 million. 
B) 60 million. 
C) 85 million. 
D) 180 million.

Question 13

Frictional unemployment occurs when:

Accepted Answer

A) there is friction between an employer and employee. 
B) a worker decides to quit to seek a different job. 
C) a large corporation transfers a worker to another city. 
D) college students go back to school at the end of the summer. 
A) there is friction between an employer and employee. 
B) a worker decides to quit to seek a different job. 
C) a large corporation transfers a worker to another city. 
D) college students go back to school at the end of the summer.

Question 14

In the nineteenth century, U.S.farmers were ordinarily debtors.Farmers typically borrowed from banks to develop new acreage and to be able to purchase necessary inputs prior to each growing season.Why did farmers generally support public policies that were inflationary?

Accepted Answer

In times of unanticipated infl

Question 15

The first formal acknowledgement of the primary macroeconomic goals of price stability, high employment, and promoting economic growth in the United States came with passage of the:

Accepted Answer

A) Federal Reserve Act of 1913. 
B) the Sherman Antitrust Act of 1890. 
C) the Social Security Act of 1935. 
D) the Employment Act of 1946. 
E) the 1964 War on Poverty campaign. 
A) Federal Reserve Act of 1913. 
B) the Sherman Antitrust Act of 1890. 
C) the Social Security Act of 1935. 
D) the Employment Act of 1946. 
E) the 1964 War on Poverty campaign.

Question 16

Unanticipated deflation will benefit creditors at the expense of debtors.

Accepted Answer

A) True 
 B)False

Question 17

The cost incurred when individuals reduce their money holdings because of inflation is termed as the:

Accepted Answer

A) nominal cost. 
B) shoe-leather cost. 
C) menu cost. 
D) implied cost. 
A) nominal cost. 
B) shoe-leather cost. 
C) menu cost. 
D) implied cost.

Question 18

The type of unemployment that occurs because of a recession is called:

Accepted Answer

A) frictional unemployment. 
B) seasonal unemployment. 
C) the natural rate of unemployment. 
D) cyclical unemployment. 
A) frictional unemployment. 
B) seasonal unemployment. 
C) the natural rate of unemployment. 
D) cyclical unemployment.

Question 19

Discuss the practical limitations of indexing absolutely everything in an economy, in order to reduce the impact of inflation?

Accepted Answer

Indexing everything would require all co

Question 20

Roughly 60 percent of women participate in the labor force today.

Accepted Answer

A) True 
 B)False

Which of the following observations concerning phases of a business cycle is incorrect?

Which of the following refers to extremely high rates of inflation for sustained periods of time?

According to Okun's law, a 2 percent increase in cyclical unemployment reduces output by almost:

Given a fixed nominal interest rate on a loan, unanticipated inflation:

The unemployment rate measures the number of unemployed people expressed as a percentage of the total population.

The unemployment rate is defined as:

Economists usually use the term "recession" to refer to:

Which piece of legislation committed the government to pursuing unemployment policies that are consistent with maintaining price stability?

The unemployment rate is calculated as:

The development of a nationwide computerized job bank listing of all job openings would be most likely to reduce:

In 2010, what percentage of the unemployed were out of work for more than 27 weeks?

Figure 11-A Assuming the data in this figure are correct, use the data to answer the following questions. -Refer to Figure 11-A.The number of people considered to be out of the labor force is:

Frictional unemployment occurs when:

In the nineteenth century, U.S.farmers were ordinarily debtors.Farmers typically borrowed from banks to develop new acreage and to be able to purchase necessary inputs prior to each growing season.Why did farmers generally support public policies that were inflationary?

The first formal acknowledgement of the primary macroeconomic goals of price stability, high employment, and promoting economic growth in the United States came with passage of the:

Unanticipated deflation will benefit creditors at the expense of debtors.

The cost incurred when individuals reduce their money holdings because of inflation is termed as the:

The type of unemployment that occurs because of a recession is called:

Discuss the practical limitations of indexing absolutely everything in an economy, in order to reduce the impact of inflation?

Roughly 60 percent of women participate in the labor force today.

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

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Exam 11: Introduction to Macroeconomics: Unemployment, Inflation, and Economic Fluctuations

Which of the following observations concerning phases of a business cycle is incorrect?

Which of the following refers to extremely high rates of inflation for sustained periods of time?

According to Okun's law, a 2 percent increase in cyclical unemployment reduces output by almost:

Given a fixed nominal interest rate on a loan, unanticipated inflation:

The unemployment rate measures the number of unemployed people expressed as a percentage of the total population.

The unemployment rate is defined as:

Economists usually use the term "recession" to refer to:

Which piece of legislation committed the government to pursuing unemployment policies that are consistent with maintaining price stability?

The unemployment rate is calculated as:

The development of a nationwide computerized job bank listing of all job openings would be most likely to reduce:

In 2010, what percentage of the unemployed were out of work for more than 27 weeks?

Figure 11-A Assuming the data in this figure are correct, use the data to answer the following questions. -Refer to Figure 11-A.The number of people considered to be out of the labor force is:

Frictional unemployment occurs when:

In the nineteenth century, U.S.farmers were ordinarily debtors.Farmers typically borrowed from banks to develop new acreage and to be able to purchase necessary inputs prior to each growing season.Why did farmers generally support public policies that were inflationary?

The first formal acknowledgement of the primary macroeconomic goals of price stability, high employment, and promoting economic growth in the United States came with passage of the:

Unanticipated deflation will benefit creditors at the expense of debtors.

The cost incurred when individuals reduce their money holdings because of inflation is termed as the:

The type of unemployment that occurs because of a recession is called:

Discuss the practical limitations of indexing absolutely everything in an economy, in order to reduce the impact of inflation?

Roughly 60 percent of women participate in the labor force today.

The Role and Method of Economics

The Economic Way of Thinking

Supply and Demand

Using Supply and Demand

Market Failure and Public Choice

Production and Costs

Firms in Competitive Markets

Monopoly

Monopolistic Competition and Oligopoly

Labor Markets, Income Distribution, and Poverty

Economic Growth

Aggregate Demand and Aggregate Supply

Fiscal Policy

Monetary Institutions

The Federal Reserve System and Monetary Policy

Issues in Macroeconomic Theory and Policy

International Economics

Filters