ECON 151 – Macroeconomics McGraw Hill Connect Chapter 9 Group Quiz – Flashcards
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A cumulative wage-price spiral which produces very rapid inflation is called: Anticipated inflation Demand-pull inflation Cost-push inflation Hyperinflation
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Hyperinflation
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What is an advantage of mild inflation according to some economists? It helps to close the GDP gap It reduces the inflation premium It makes it easier for firms to adjust real wages downward as demand for their products falls
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It makes it easier for firms to adjust real wages downward as demand for their products falls
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Inflation is a rise in: The general level of prices over time The standard of living over time Unemployment over time Real GDP over time
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The general level of prices over time
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Which of the following measures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers? The GDP Price Index The Consumer Price Index The Retail Trade survey The Wholesale Price Index
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The Consumer Price Index
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Inflation caused by an increase in aggregate spending is referred to as: Cost-push inflation Anticipated inflation Demand-pull inflation Hyperinflation
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Demand-pull inflation
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Inflation caused by a rise in the prices of inputs is referred to as: Cost-push inflation Demand-pull inflation Unanticipated inflation Hyperinflation
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Cost-push inflation
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. Assume that there is a fixed rate of interest on contracts for borrowers and lenders. If unanticipated inflation occurs in the economy, then: Both lenders and borrowers benefit Both lenders and borrowers are hurt Borrowers are hurt, but lenders benefit Lenders are hurt, but borrowers benefit
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Lenders are hurt, but borrowers benefit
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The recurrent ups and downs in the level of economic activity extending over several years are referred to as: Economic phases Business startups Business cycles Noncyclical fluctuations
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Business cycles
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A trough in the business cycle occurs when: Cyclical unemployment is at a minimum point Employment and output reach their lowest levels The natural rate of unemployment is at a minimum point The inflation rate is at its lowest level
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Employment and output reach their lowest levels
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Most economists agree that the immediate cause of the majority of cyclical changes in the level of real output is Level of total spending Rate of unemployment Rate of inflation Stock market price indexes
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Level of total spending
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The Great Recession that started in 2007 was triggered by shocks in which of the following economic sectors? Gold market and stock market International trade and foreign exchange markets Real estate and financial markets Consumer and government spending
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Real estate and financial markets
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The unemployment rate is interpreted as the percentage of the: Adult population who are unemployed Labor force that are not employed Able-bodied population who are not working Work force that have been laid off
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Labor force that are not employed
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Which of the following is the correct way to calculate the unemployment rate? [(unemployed)/(population)] × 100 [(unemployed)/(labor force)] × 100 [(labor force)/(population)] × 100 [(labor force)/(unemployed)] × 100
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[(unemployed)/(labor force)] × 100
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In calculating the unemployment rate, "discouraged" workers who are not actively seeking employment are: Excluded from the labor force Included as part of the unemployed Treated the same as part-time workers Used to determine the size of the labor force
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Excluded from the labor force
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In calculating the unemployment rate, part-time workers are: Counted as unemployed because they are not working full-time Counted as employed because they are receiving payment for work Used to determine the size of the labor force, but not the unemployment rate Treated the same as "discouraged" workers who are not actively seeking employment
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Counted as employed because they are receiving payment for work
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Search and wait unemployment is another way to describe: Noncyclical unemployment Cyclical unemployment Frictional unemployment Structural unemployment
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Frictional unemployment
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"Full employment" refers to the situation when there is: 100% employment of the labor force 0% unemployment rate No frictional or structural unemployment No cyclical unemployment
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No cyclical unemployment
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The one quirk that labor markets have, which helps explain why unemployment goes up so much in a recession is that: A price floor called a "minimum wage law" exists for the labor market Wages are flexible upward but "sticky" downward Firms are "demanders" of labor, rather than suppliers Machines could "replace" humans in the labor market
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Wages are flexible upward but "sticky" downward
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If the Consumer Price Index for a certain year is 120, this means that the average price of consumer items in that year was: 20% higher than the average price in the base period 1982-84 ? About $120 per basket of consumer goods and services 120% higher than the average price in the base period 1982-84 20% higher than the average price of the preceding year
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20% higher than the average price in the base period 1982-84
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The 2 in an economy is 6%. The total population of the economy is 290 million, and the size of the civilian labor force is 150 million. The number of unemployed workers in this economy is: 6 million 9 million 12 million 24 million
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9 million
