Ch 9

Question 0

The unemployment rate of

Answer 0

Teenagers is much higher than that of the adults

Question 1

Most economists agree that the immediate determinant of the volume of output and employment is the

Answer 1

Level of total spending

Question 2

Cyclical unemployment results from

Answer 2

A deficiency of spending on goods and services

Question 3

Structural unemployment

Answer 3

May involve a locational mismatch between unemployed workers and job openings

Question 4

Wait unemployment and search Unemployment are both types of what kind of unemployment

Answer 4

Frictional unemployment

Question 5

The relationship between the size of the negative GDP gap and unemployment rate is

Answer 5

A direct relationship

Question 6

If the consumer price index calls from 120 to 116 in a particular year, economy has experienced

Answer 6

A deflation of 3.33%

Question 7

Demand pull inflation occurs when

Answer 7

Occurs when total spending in the economy is excessive

Question 8

Inflation initiated by increases in wages or other resource prices is labeled

Answer 8

Cost push inflation

Question 9

Cost push inflation moves the production possibilities curve how

Answer 9

Moves economy inward from its production possibilities curve

Question 10

Inflation affects

Answer 10

Both The level and the distribution of income

Question 11

Supposed nominal annual interest rate on a two year loan is 8% lenders expect inflation to the 5% in each of the two years. The annual real rate of interest is

Answer 11

3%

Question 12

The feudal practice of clipping coins illustrates the idea

Answer 12

Taxation through inflation

Question 13

Declines in stock prices measured by the Dow Jones average

Answer 13

Sometimes precedes recession, sometimes do not

Question 14

True or false. People who work part time, but desire to work full time, Are considered to be officially unemployed

Answer 14

False

Question 15

The industries or sectors of the economy in which business cycle fluctuations tend to affect output most are

Answer 15

Capital goods and durable consumer goods

Question 16

True or false. There are a wide range of theories as to the underlying causes of business cycle movements

Answer 16

True

Question 17

Kara voluntarily quit her job as an insurance agent to return to school full-time to earn an MBA degree. With degree in hand she is now searching for a position in management presently what type of unemployment

Answer 17

Frictionally unemployed

Question 18

True or false. The unemployment rates of men and women workers are roughly the same

Answer 18

True

Question 19

The type of unemployment associated with recession is called

Answer 19

Cyclical unemployment

Question 20

A large negative GDP gap implies

Answer 20

A high rate of unemployment

Question 21

If actual GDP is 500 billion and there is a negative GDP gap of 10 billion potential GDP is

Answer 21

510 billion

Question 22

It’s potential GDP is 330 billion and there is a positive GDP 30 billion real GDP is

Answer 22

360 billion

Question 23

Demand pull inflation occurs when

Answer 23

Occurs only when the economy has reached it’s absolute production capacity

Question 24

Real income can be determined by

Answer 24

Deflating nominal income for inflation

Question 25

True or false. The price level double and a 23 year period, we can conclude that the average annual rate of inflation over that. Period Was about 3%

Answer 25

True