Things To Work On Before Midterm

Question 1

3 attributes of potential gdp

Answer 1

1. What an economy can produce with the resources it has
2. Resources are operating at full employment
3. Long term target level of production for an economy

Question 2

Natural rate of unemployment

Answer 2

The unemployment rate is from frictional and structural unemployment (there is 0 cyclical unemployment).

Question 3

Frictional unemployment

Answer 3

Have the right skills but looking for a job

Question 4

Structural unemployment

Answer 4

People do not have the right skills or they are not living in the right areas

Question 5

Cyclical unemployment

Answer 5

People are unemployed because there are no jobs for them.

Question 6

Cause for cyclical unemployment

Answer 6

Jobs do not exist due to low spending in the economy

Question 7

When the population increases, potential gdp ____, and potential gdp per hour ___

Answer 7

Increases; decreases

Question 8

Increase in economic growth

Answer 8

Long period of increase in potential growth

Question 9

The value of the money in your pocket is also known as the

Answer 9

Cpi

Question 10

An increase in labour productivity​ _________ employment and​ ______ real GDP.

Answer 10

increases; increases

Question 11

The increased labour productivity​ ______ the demand for labour and​ ______ the supply of labour.

Answer 11

increases; does not change

Question 12

The inflation rate is the annual percentage change of the

Answer 12

price level.