1. Which of the following is true of
unemployment?
A) It is defined as the number of people actively looking for work who do not have jobs.
B) The result is that the economy operates inside its production possibilities curve.
C) There are psychological consequences associated with unemployment.
D) All of the above.
2. Which of the following people would be considered unemployed?
A) Homer, who lost his job at the power plant and is not looking for work
B) Lenny, who is working part time at a fast food restaurant
C) Abe, who is retired
D) Edna, who lost her job as a teacher and is currently searching for a new job
3. When did the United States register its lowest unemployment rate?
A) In the 1920s
B) In the economic boom of the 1990s
C) In the Roaring Nineties (1890s)
D) At the end of World War II
4. When the demand for labor decreases, the real wage will ________ and the unemployment rate will ________.
A) fall; rise
B) fall; fall
C) rise; fall
D) rise; rise
5. Official unemployment rates may underestimate the true rate of unemployment because the official rate
A) includes those workers who only work part time.
B) may include some individuals who are not actually in the labor force.
C) does not include individuals receiving any type of unemployment compensation.
D) fails to include discouraged workers.
6. The CPI was 140 in one year and 144 the following year. Approximately how much did prices rise between the two years?
|
a. |
2.85 percent |
|
b. |
2.78 percent |
|
c. |
0.03 percent |
|
d. |
1.03 percent |
|
e. |
none of the above |
7. In year 1 the CPI is 141, and in year 2 the CPI is 149. If Dennis's salary was $65,000 in year 1, what is the minimum salary he must earn in year 2 to "more than keep up with inflation"?
|
a. |
$96,850 |
|
b. |
$68,685 |
|
c. |
$91,650 |
|
d. |
$101,400 |
8. The total civilian labor force is comprised of
A) the unemployed and the employed.
B) only the employed.
C) all individuals over 16 years of age, whether or not they work or are seeking work.
D) only full-time employed individuals between the ages of 18 and 55
9. Real per capita GDP will increase
a. any time Real GDP increases.
?b. when Real GDP increases at a faster rate than population increase.
?c. only when population decreases.
?d. none of the above.
11. The broadest indication of economy-wide inflation is captured by the
A) Consumer Price Index.
B) Gross Domestic Product (GDP) deflator.
C) Producer Price Index.
D) Urban Wage Deflator.
12. If the rate of inflation is 4 percent and the real interest rate is 3 percent, the nominal interest rate should be
A) 1 percent.
B) 4 percent.
C) 7 percent.
D) 11 percent.
13.The effect of a nation’s productivity increasing at a greater rate than its population is:
14.Suppose during the course of a year, an economy produces $10 trillion of consumer goods, $2 trillion of investment goods, $5 trillion in government services, and has $1 trillion of exports and $2 trillion of imports, and $4 trillion in taxes. For that economy, GDP would be:
15. In contrast to nominal GDP, real GDP refers to nominal GDP
1. All of the above options are true for unemployment. Hence the correct answer is (D).
2. Edna, who lost her job as a teacher and is currently searching for a new job will be considered unemployed. Hence the correct answer is (D).
3. The USA registered its lowest rate of unemployment at the end of world war 2. Hence the correct answer is (D).
4. When the demand for labor falls, the real wage falls and the unemployment rate rises. Hence the correct answer is (A).
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