Question

Question 51 pts

The _____ the unemployment rate and the _____ the rate of inflation, the higher the misery index.

lower; higher

lower; lower

higher; lower

higher; higher

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Question 61 pts

Which of the following would be an example of the discouraged worker effect

John loses his job and can’t find a new one as new technology is adopted in his industry.

Mary gives up looking for a job because of the lousy economy.

Mark decides to reenter the labor force after going back to school to study economics.

Alice loses her construction job because of winter weather.

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Question 71 pts

If inflation falls from 5% to 3% to 1.3% it is sometimes called

a deflation.

a disinflation.

a reinflation.

a postinflation.

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Question 81 pts

Which of the following would cause cost push inflation?

Excessive money creation by the government.

Excessive purchases by the foreign sector.

Rising oil prices.

Excessive government spending.

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Question 91 pts

The unemployment rate is the

ratio of unemployed to employed workers.

number of employed workers minus the number of workers who are not in the labor force.

percentage of the civilian labor force which is out of work.

percentage of the total population which is out of work.

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Question 101 pts

Which of the following statements best describes the problem of stagflation?

Both inflation and economic expansion are occurring simultaneously.

Prices are falling at the same time aggregate output is increasing.

It is a period where both prices and unemployment increase simultaneously.

There is excessive spending by consumers overheating the economy.

Answer 1

51) High unemployment and high inflation create high misery. Therefore the fourth option is correct.

61) Discouraged workers are those who were looking for work but have given up. Thus the second option is correct

71)Disinflation means the inflation rate is declining over time but remain positive. Thus the second option is correct

81) Cost-push inflation means inflation occurs due to increase in the price of input like raw materials, labour etc. Therefore the third option is correct.