Question 1

In 2013,Caterpillar laid off employees.The employees who were laid off due to the business cycle would be considered

Accepted Answer

A)  structurally unemployed.
B)  frictionally unemployed.
C)  seasonally unemployed.
D)  cyclically unemployed.

Question 2

Efficiency wages cause unemployment because

Accepted Answer

A)  firms pay wages that are below the market wage, causing the quantity of labor demanded to be greater than the quantity of labor supplied.
B)  firms pay wages that are below the market wage, causing the quantity of labor demanded to be less than the quantity of labor supplied.
C)  firms pay wages that are above the market wage, causing the quantity of labor demanded to be greater than the quantity of labor supplied.
D)  firms pay wages that are above the market wage, causing the quantity of labor demanded to be less than the quantity of labor supplied.

Question 3

We say that the economy is at full employment if the unemployment rate is equal to

Accepted Answer

A)  zero.
B)  the natural rate of unemployment.
C)  the amount of cyclical unemployment.
D)  the sum of frictional and cyclical unemployment.
E)  the sum of structural and cyclical unemployment.

Question 4

If the minimum wage is set above the market wage,

Accepted Answer

A)  the quantity of labor supplied will be below the quantity of labor demanded.
B)  unemployment will rise.
C)  highly-skilled workers will have a harder time finding jobs.
D)  All of the above are correct.

Question 5

In 1986,an Apple IIe computer with 65 kilobytes of memory cost around $1,500.Today,a $1,500 iMac computer (also made by Apple) comes with 8 gigabytes of memory.This illustrates the potential for what kind of bias in CPI calculations?

Accepted Answer

A)  new product bias
B)  increase in quality bias
C)  substitution bias
D)  outlet bias

Question 6

Which of the following individuals would be most negatively affected by anticipated inflation?

Accepted Answer

A)  a retired railroad engineer who receives a fixed income payment every month
B)  a union contractor whose pay is adjusted based on changes in the CPI
C)  a full-time employee at a pizza parlor who makes more than the minimum wage
D)  a student who borrows $10,000 at a nominal interest rate of 5% to finance educational expenses

Question 7

During the month of May,10 million workers moved from being classified as "unemployed" to being classified as "employed." As a result

Accepted Answer

A)  the unemployment rate rose.
B)  the labor force participation rate fell.
C)  the unemployment rate fell.
D)  the labor force participation rate rose.

Question 8

The Bureau of Labor Statistics would categorize a person as ________ if they were temporarily away from their job because they were ill.

Accepted Answer

A)  employed
B)  unemployed
C)  a discouraged worker
D)  out of the labor force

Question 9

The labor force equals the number of people

Accepted Answer

A)  employed.
B)  unemployed.
C)  employed plus unemployed.
D)  in the working-age population.

Question 10

Explain what economists mean by full employment and why this rate of unemployment is not zero.

Accepted Answer

Full employment occurs in the macro econ...

Question 11

Eliminating structural unemployment would be good for the economy.

Accepted Answer

A) True 
 B)False

Question 12

Inflation redistributes income to a greater extent when the inflation is unanticipated compared to when the inflation is anticipated.

Accepted Answer

A) True 
 B)False

Question 13

Fill in the missing values in the table of data collected in the household survey for November,2009.The working-age population,employment,unemployment,and labor force are measured in thousands.Show your work.
 $$\begin{array} { | l | c | } 
\hline \begin{array} { l } 
\text { Working-age } \
\text { population }
\end{array} & 235,900 \
\hline \text { Employment } & \
\hline \text { Unemployment } & \
\hline \text { Unemployment rate } & 9.4 \% \
\hline \text { Labor force } & \
\hline \text { Labor force } & \
\text { participation rate } & 65.5 \% \
\hline
\end{array}$$

Accepted Answer

\[\begin{array} { | l | c | }
\hline \b...

Question 14

Housing is the largest component of the U.S.CPI market basket.

Accepted Answer

A) True 
 B)False

Question 15

Table 13-15
   Year  Nominal Average  Hourly Earnings  CPI 2011$10100201210105201312110\begin{array} { | c | c | c | } \hline 	ext { Year } & \begin{array} { c } 	ext { Nominal Average } \	ext { Hourly Earnings }\end{array} & 	ext { CPI } \\hline 2011 & \$ 10 & 100 \\hline 2012 & 10 & 105 \\hline 2013 & 12 & 110 \\hline\end{array} Year 201120122013​ Nominal Average  Hourly Earnings ​$101012​ CPI 100105110​​ 
-Refer to Table 13-15.Looking at the table above,real average hourly earnings in 2011 were

Accepted Answer

A)  $9
B)  $9.52
C)  $10
D)  $12.63

Question 16

If inflation increases unexpectedly,then

Accepted Answer

A)  borrowers pay a higher real interest rate than they expected.
B)  lenders receive a lower real interest rate than they expected.
C)   lenders gain and borrowers gain.
D)  neither borrowers nor lenders lose.

Question 17

The labor force is the sum of

Accepted Answer

A)  employed workers and discouraged workers.
B)  employed workers and unemployed workers.
C)  employed workers and individuals not looking for work.
D)  employed workers and the working age population.
E)  unemployed workers and the working age population.

Question 18

The natural rate of unemployment consists of frictional unemployment plus cyclical unemployment.

Accepted Answer

A) True 
 B)False

Question 19

Suppose the government launches a successful advertising campaign that convinces workers with high school degrees to quit their jobs and become full time college students.This would cause

Accepted Answer

A)  the unemployment rate to decrease.
B)  the labor force participation rate to decrease.
C)  the number of discouraged workers to increase.
D)  no change in the unemployment rate.

Question 20

An unemployment insurance program has which of the following effects?

Accepted Answer

A)  It decreases the amount of personal income of the unemployed.
B)  It contributes to the severity of a recession or economic downturn.
C)  It increases the amount of time spent searching for a job.
D)  It lowers the overall unemployment rate.

Exam 13: Unemployment and Inflation

Suppose the government launches a successful advertising campaign that convinces workers with high school degrees to quit their jobs and become full time college students.This would cause

Correct Answer
verified

The labor force equals the number of people

Correct Answer
verified

Explain what economists mean by full employment and why this rate of unemployment is not zero.

Correct Answer
verified
Full employment occurs in the macro econ...
View Answer

If inflation increases unexpectedly,then

Correct Answer
verified

Inflation redistributes income to a greater extent when the inflation is unanticipated compared to when the inflation is anticipated.

Correct Answer
verified

An unemployment insurance program has which of the following effects?

Correct Answer
verified

Efficiency wages cause unemployment because

Correct Answer
verified

Correct Answer
verified

Housing is the largest component of the U.S.CPI market basket.

Correct Answer
verified

The Bureau of Labor Statistics would categorize a person as ________ if they were temporarily away from their job because they were ill.

Correct Answer
verified

Correct Answer
verified
\[\begin{array} { | l | c | }
\hline \b...
View Answer

Eliminating structural unemployment would be good for the economy.

Correct Answer
verified

If the minimum wage is set above the market wage,

Correct Answer
verified

In 2013,Caterpillar laid off employees.The employees who were laid off due to the business cycle would be considered

Correct Answer
verified

Which of the following individuals would be most negatively affected by anticipated inflation?

Correct Answer
verified

We say that the economy is at full employment if the unemployment rate is equal to

Correct Answer
verified

The natural rate of unemployment consists of frictional unemployment plus cyclical unemployment.

Correct Answer
verified

The labor force is the sum of

Correct Answer
verified

In 1986,an Apple IIe computer with 65 kilobytes of memory cost around $1,500.Today,a $1,500 iMac computer (also made by Apple) comes with 8 gigabytes of memory.This illustrates the potential for what kind of bias in CPI calculations?

Correct Answer
verified

During the month of May,10 million workers moved from being classified as "unemployed" to being classified as "employed." As a result

Correct Answer
verified

Exam 13: Unemployment and Inflation

Suppose the government launches a successful advertising campaign that convinces workers with high school degrees to quit their jobs and become full time college students.This would cause

Correct AnswerverifiedShow Answer

The labor force equals the number of people

Correct AnswerverifiedShow Answer

Explain what economists mean by full employment and why this rate of unemployment is not zero.

Correct AnswerverifiedFull employment occurs in the macro econ...View AnswerShow Answer

If inflation increases unexpectedly,then

Correct AnswerverifiedShow Answer

Inflation redistributes income to a greater extent when the inflation is unanticipated compared to when the inflation is anticipated.

Correct AnswerverifiedShow Answer

An unemployment insurance program has which of the following effects?

Correct AnswerverifiedShow Answer

Efficiency wages cause unemployment because

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Housing is the largest component of the U.S.CPI market basket.

Correct AnswerverifiedShow Answer

The Bureau of Labor Statistics would categorize a person as ________ if they were temporarily away from their job because they were ill.

Correct AnswerverifiedShow Answer

Correct Answerverified\[\begin{array} { | l | c | } \hline \b...View AnswerShow Answer

Eliminating structural unemployment would be good for the economy.

Correct AnswerverifiedShow Answer

If the minimum wage is set above the market wage,

Correct AnswerverifiedShow Answer

In 2013,Caterpillar laid off employees.The employees who were laid off due to the business cycle would be considered

Correct AnswerverifiedShow Answer

Which of the following individuals would be most negatively affected by anticipated inflation?

Correct AnswerverifiedShow Answer

We say that the economy is at full employment if the unemployment rate is equal to

Correct AnswerverifiedShow Answer

The natural rate of unemployment consists of frictional unemployment plus cyclical unemployment.

Correct AnswerverifiedShow Answer

The labor force is the sum of

Correct AnswerverifiedShow Answer

In 1986,an Apple IIe computer with 65 kilobytes of memory cost around $1,500.Today,a $1,500 iMac computer (also made by Apple) comes with 8 gigabytes of memory.This illustrates the potential for what kind of bias in CPI calculations?

Correct AnswerverifiedShow Answer

During the month of May,10 million workers moved from being classified as "unemployed" to being classified as "employed." As a result

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Full employment occurs in the macro econ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
\[\begin{array} { | l | c | }
\hline \b...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified