Question

33. Monthly labor market reports issued by the Bureau of Labor Statistics primarily are based upon: (a) initial claims for unemployment insurance reported by the 50 states; (b) the National Income and Product Accounts; (c) an Establishment Survey and a Household Survey; (d) data collected by each of the 12 Federal Reserve Banks.

34. In recent years, the labor force participation rate in the United States is closest to: (a) 45%; (b) 65%; (c) 85%; (d) 90%.

35. The top chemist for an industrial company loses her job because the company goes out of business. This chemist is now teaching high school chemistry. We might say that she is: (a) under-employed; (b) a discouraged worker; (c) only marginally-attached to the labor force; (d) structurally unemployed.

36. Which of the following puts a virtual floor under the unemployment rate (a level below which it is unlikely to fall)? (a) there will always be cyclical unemployment; (b) there always will be unemployment among children; (c) there always will be discouraged workers; (d) there always will be “structural” unemployment (frictional plus structural unemployment).

37. Rising income inequality exacerbates rising wealth inequality partly because individuals with relatively higher incomes: (a) almost always pay less in taxes than individuals with relatively lower incomes; (b) tend to save more than their lower-income neighbors and can earn more non-wage and salary income; (c) tend to live predominantly in low-cost areas of the country; (d) tend to have more children than their lower-income counterparts who can contribute the their family’s well-being.

38. Which of the following is the BEST way to define “Say’s Law?” (a) supply creates its own demand; (b) continue to add capital until the marginal product of capital is zero; (c) equilibrium takes place at the intersection of a supply curve and a demand curve; (d) the act of producing output in a closed economy generates enough income to buy back all of the output produced.

39. Which of the following is NOT generally considered a determinant of the U.S. labor force participation rate? (a) the level of “discouragement” among unemployed persons; (b) cultural factors, such as the willingness and ability of caregivers to work; (c) frictional unemployment; (d) demographics.

40. China and India tend to have higher sustained growth in real GDP than most developed market countries, because: (a) China and India have relatively more rapid population growth; (b) China’s and India’s growth rates are measured off a smaller base than those of developed economies; (c) China and India have made rapid real economic growth a top national priority; (d) all of the above.

41. The M-1 monetary aggregate includes only the forms of money that are: (a) most liquid; (b) in savings accounts; (c) the highest interest-earning assets; (d) backed up by the gold reserves of the United States.

42. The Solow model implies all of the following, except: (a) supply creates its own demand; (b) countries that devote a relatively larger share of output to investment will be wealthier; (c) growth will be faster the farther away a country’s capital stock is from its steady-state; (d) new ideas are the driving force behind long-run economic growth.

Answer 1

1) Solution: an Establishment Survey and a Household Survey

Explanation: Establishment Survey and a Household Survey measure the labor force status for the reports issued by the Bureau of Labor Statistics

2) Solution: structurally unemployed

Explanation: Structural unemployment occurs due to the mismatch among the available jobs and the skill levels of the worker

3) Solution: there always will be “structural” unemployment (frictional plus structural unemployment).

Explanation: The workers will always switch between jobs thus causing a frictional and structural unemployment

4) Solution: tend to save more than their lower-income neighbors and can earn more non-wage and salary income

Explanation: The high income people tends to save more thus would causes an income-inequality

As per policy we have to answer first four questions