Economic Quiz 6

Refer to Exhibit 6-2. The labor force participation rate in year 4 is Question 10 options: a. 12 1/2 percent. b. 72 percent. c. 87 1/2 percent. d. 30 percent. e. 80 percent.

a. 12 1/2 percent. (guess)

Suppose that in an economy the frictional unemployment rate is 3.1 percent, the natural unemployment rate is 4.5 percent, and the cyclical unemployment rate is -1 percent. The structural unemployment rate is _________ percent and the actual unemployment rate (in this economy) is ___________ percent. Question 9 options: a. 1.4; 5.5 b. 1.4; 3.5 c. 7.6; 6.6 d. 3.5; 1.4

b. 1.4; 3.5 (guess)

Refer to Exhibit 6-2. How many persons are not participating in the labor force in year 3? Question 18 options: a. 50 million b. 100 million c. 150 million d. 350 million e. 400 million

b. 100 million

Look at the following data: The structural unemployment rate is 4 percent, the natural unemployment rate is 5 percent, and the cyclical unemployment rate is 3 percent. The frictional unemployment rate is ____________ percent and the actual unemployment rate is __________ percent. a. 2; 7 b. 2; 8 c. 1; 7 d. 1; 8

b. 2; 8 (guess)

Look at the following data: The frictional unemployment rate is 3 percent, the natural unemployment rate is 6.5 percent, and the cyclical unemployment rate is 2.4 percent. The structural unemployment rate is __________ percent and the actual unemployment rate (in this economy) is __________ percent. Question 16 options: a. 3; 8.9 b. 3.5; 8.9 c. 3.5; 9.5 d. 5.4; 2.4 e. none of the above

b. 3.5; 8.9

Exhibit 6-2 Refer to Exhibit 6-2. How many persons are not participating in the labor force in year 1? a. 25 million b. 50 million c. 75 million d. 175 million e. 200 million

b. 50 million

Refer to Exhibit 6-2. The unemployment rate in year 4 is Question 19 options: a. 12 1/2 percent. b. 72 percent. c. 87 1/2 percent. d. 10 percent. e. 90 percent.

b. 72 percent.

Suppose that the price index in 1999 was 170 and your salary was $44,000. Suppose in 2016 the consumer price index will be 290. What salary will you have to earn in 2016 in order to equal your 1999 real income? a. $66,000 b. $77,647 c. $75,059 d. $83,209

c. $75,059

Refer to Exhibit 6-2. How many unemployed persons are there in year 3? Question 7 options: a. 50 million b. 100 million c. 150 million d. 350 million e. 400 million

c. 150 million (guess)

Suppose the market basket consists of 400X, 150Y, and 220Z. Current-year prices are $1.50 for each unit of X, $0.50 for each unit of Y, and $4.60 for each unit of Z. Base-year prices are $1.00 for each unit of X, Y, and Z. Approximately what is the value of the CPI in the current year? a. 457 b. 354 c. 219 d. 119

c. 219

The CPI was 154 in one year and 165 the following year. How much did prices rise between these two years? a. 5.46 percent b. 6.67 percent c. 7.14 percent d. 0.07 percent

c. 7.14 percent

The unemployment due to changes in the types of skills employers require is called __________ unemployment. Question 10 options: a. structural b. cyclical c. natural d. frictional

structural

A movie star was paid $1 million in 1960 to do a movie. The CPI was 29.3 in 1960 and the CPI in 2014 was 240. Approximately how much did the movie star earn in 2014 dollars? a. $0.87 million b. $8.66 million c. $6.44 million d. $7.74 million ​e. $8.19 million

​e. $8.19 million

If a person did any work as a paid employee during the Bureau of Labor Statistics survey reference week, how is she classified? Question 19 options: a. as an employed person b. as not in the labor force c. as an unemployed person d. as part of the labor force ​e. a and d

​e. a and d

In order to be classified as unemployed, a person must be not working, a. have been actively looking for work within the past four weeks, and currently be available for work. b. and currently be available for work, regardless of whether one is actively looking for work or not. c. and be waiting to be called back to work from a temporary layoff. d. and actively looking for work within the past year. ​e. a or c

​e. a or c

Good X sold for $40 in 1957. The CPI in 1957 was 27.6 and the CPI in 2014 was 244.537. What was the price of good X in 2014 dollars? a. $514.60 b. $270.92 c. $1,201.60 d. $310.92 ​e. $354.40

b. $270.92

Refer to Exhibit 6-1. Prices rose by __________ percent from Year 1 to Year 2. Question 2 options: a. 1.38 b. 0.14 c. 1.29 d. 1.94 e. 3.00

a. 1.38

Exhibit 6-1 Refer to Exhibit 6-1. Prices rose by approximately __________ percent from Year 1 to Year 5. Question 11 options: a. 10.6 b. 9.6 c. 14.3 d. 4.5

a. 10.6

Refer to Exhibit 6-2. The unemployment rate in year 1 is Question 3 options: a. 12 1/2 percent. b. 70 percent. c. 87 1/2 percent. d. 30 percent. e. 10 percent.

a. 12 1/2 percent.

Suppose there are 50 million persons in the population, 25 million persons in the civilian labor force, and 20 million persons are employed. The number of persons unemployed is _______ million and the unemployment rate is ___________ percent. Question 17 options: a. 25; 50 b. 5; 10 c. 5; 20 d. 10; 10

a. 25; 50 (GUESS)

Refer to Exhibit 6-1. Prices rose by __________ percent from Year 4 to Year 5. a. 3.90 b. 3.75 c. 4.30 d. 5.90

a. 3.90

If the CPI is 220 and nominal income is $37,000, approximately what does real income equal? Question 2 options: a. $81,400 b. $16,818 c. $76,500 d. $44,118

b. $16,818

At the time of Carol's 10 year high school reunion she was earning $30,000 and the CPI was 90. Now that it is time for her to attend her 20 year high school reunion, Carol's income has risen to $65,000 and the CPI is 200. At her 20 year reunion, can Carol rightfully brag that her real income has risen since the last time she saw her former classmates ten years ago? Question 15 options: a. Yes, Carol's real income rose during that 10 year period. b. No, Carol's real income fell during that 10 year period. c. No, Carol's real income remained constant during that 10 year period. d. It is impossible to determine what happened to Carol's real income.

b. No, Carol's real income fell during that 10 year period.

If a person is waiting to be called back to a job from which she has been laid off, how is she classified by the Bureau of Labor Statistics? Question 18 options: a. as not in the labor force b. as an unemployed person c. as an employed person d. as a discouraged worker

b. as an unemployed person

If we subtract the number of persons not in the labor force from the civilian noninstitutional population, we get the number of people in the a. ranks of the unemployed. b. civilian labor force. c. ranks of the employed. d. ranks of discouraged workers. e. none of the above

b. civilian labor force.

Assume that Dakota's salary is $49,500, up from $45,000 last year, while the CPI is 198 this year, up from 180 last year. This means that Dakota's real income has ____________ since last year. Question 8 options: a. increased b. decreased c. stayed the same d. There is not enough information provided to answer this question.

b. decreased (guess)

A plumber who quits his job in Indianapolis and moves to Orlando where additional plumbers are needed is said to be ___________________ a. unemployed b. frictionally c. structurally d. cyclically e. underemployed

b. frictionally

Persons who are retired or engaged in own-home housework are considered to be in which of the following categories? Question 14 options: a. in the civilian labor force b. not in the labor force c. employed d. unemployed

b. not in the labor force

Suppose there are 200 million persons in the population, 120 million persons in the civilian labor force, and 90 million persons are employed. The number of persons unemployed is _______ million and the unemployment rate is ___________ percent. Question 16 options: a. 30; 25 b. 30; 33 c. 30; 5 d. 80; 40

a. 30; 25

If there are 10 job losers, 12 job leavers, 13 reentrants, and 12 new entrants, then there are __________ unemployed persons. Question 16 options: a. 35 b. 47 c. 25 d. 37 e. There is not enough information to answer the question.

a. 35 (GUESS)

In an economy with a population of 100 million persons, 42 million hold civilian jobs and 6 million are not working but are looking for jobs. The number counted as unemployed is Question 11 options: a. 48 million. b. 6 million. c. 36 million. d. 52 million. e. 58 million.

a. 48 million. (this means that 42 million of people working plus the 6 million of people actively looking for a job, the civilian labor force will be 48 million people.)

In year 1 the CPI is 140, and in year 2 the CPI is 154. From year 1 to year 2, Marcy's salary rises from $43,000 to $48,000, and Daphne's salary rises from $65,000 to $70,000. Who is "more than keeping up with inflation"? a. Marcy b. Daphne c. both Marcy and Daphne d. neither Marcy nor Daphne

a. Marcy

If the existing unemployment rate is 3.1 percent and the natural unemployment rate is 4.5 percent, the cyclical unemployment rate is ________ percent. Question 7 options: a. 7.6 b. 3.8 c. -1.4 d. 1.4

b. 3.8 ( Guess )

Exhibit 6-2 Refer to Exhibit 6-2. The employment rate in year 3 is a. 12 1/2 percent. b. 33 1/3 percent. c. 70 percent. d. 66 2/3 percent. e. 25 percent.

b. 33 1/3 percent. ( Guess )

If the existing unemployment rate is 6.2 percent and the natural unemployment rate is 4.5 percent, the cyclical unemployment rate is ________ percent. a. 10.7 b. 5.35 c. -1.7 d. 1.7

b. 5.35 (Guess)

Look at the following data: The frictional unemployment rate is 2 percent, the structural unemployment rate is 3.5 percent, and the actual unemployment rate is 9.5 percent. The natural unemployment rate is ____________ percent and the cyclical unemployment rate is __________ percent. Question 12 options: a. 1.5; 4 b. 5.5; 4 c. 1.5; 6 d. 6; 15

b. 5.5; 4

If the CPI is 230 in year 1 and 249 in year 2, what is the approximate percentage change in prices between the two years? Question 12 options: a. 7.6 percent b. 8.3 percent c. 15.7 percent d. 11.4 percent e. 6.0 percent

b. 8.3 percent

If the cyclical unemployment rate is negative, then the a. natural unemployment rate is less than the actual unemployment rate in the economy. b. natural unemployment rate is greater than the actual unemployment rate in the economy. c. structural unemployment rate is greater than the frictional unemployment rate. d. structural unemployment rate is less than the frictional unemployment rate. e. a and d

b. natural unemployment rate is greater than the actual unemployment rate in the economy.

The unemployment rate equals the Question 9 options: a. number of employed persons divided by the number of unemployed persons. b. number of unemployed persons divided by the civilian non-institutional population. c. number of unemployed persons divided by the civilian labor force. d. sum of unemployed persons and discouraged workers divided by the civilian labor force.

b. number of unemployed persons divided by the civilian non-institutional population.

One measure of the inflation rate is the Question 8 options: a. sum of the CPIs of adjacent years. b. percentage change in the CPI of adjacent years. c. percentage change in the Real GDP of adjacent years. d. GDP minus the Real GDP in a year.

b. percentage change in the CPI of adjacent years.

A person in the civilian labor force falls into one of two categories: Question 11 options: a. a person who works in a service industry or a person who works in a manufacturing industry. b. unemployed or employed. c. disemployed or unemployed. d. a self-employed worker or a non-self-employed worker.

b. unemployed or employed.

When electronic digital wristwatches were first introduced in 1972 they were priced at $2,100. If the CPI in 1972 was 42 and the CPI in 2019 is 275, then this price is equivalent to approximately ______________________in 2019 dollars. Question 8 options: a. $20,950 b. $11,650 c. $13,750 d. $245 e. $321

c. $13,750

Suppose there are five goods in the economy, A-E. The current-year quantity of each is 10A, 20B, 30C, 40D, and 50E. Current-year prices are $1 for each unit of A, $2 for each unit of B, $3 for each unit of C, $4 for each unit of D, and $5 for each unit of E. Base-year prices are $1 for each good. Real GDP in the current year equals Question 18 options: a. $100. b. $130. c. $150. d. $180. e. $550.

c. $150.

In an economy with a population of 300 million persons, 130 million hold civilian jobs and 8 million are not working but are looking for jobs. The unemployment rate is a. 6.2 percent. b. 8.6 percent. c. 2.7 percent. d. 9.4 percent. e. 5.8 percent.

c. 2.7 percent. ( GUESS )

Exhibit 6-2 Refer to Exhibit 6-2. The employment rate in year 4 is a. 12.5 percent. b. 7.2 percent. c. 72 percent. d. 10 percent. e. 90 percent.

c. 72 percent.

Suppose that 1982 is the base year for the Consumer Price Index (CPI) and in 2019 the CPI is 270. What does this "270" mean? a. What cost $100 in 1982 on average cost 270 times as much in 2019. b. What cost $100 in 1982 on average cost $270 in 2019. c. What cost $100 in 1982 on average cost 0.27 times as much in 2019. d. What cost $100 in 1982 on average cost $27 more in 2019

c. What cost $100 in 1982 on average cost 0.27 times as much in 2019. (GUESS)

The difference between the existing unemployment rate and the natural unemployment rate is defined is the __________ unemployment rate. a. frictional b. structural c. cyclical d. natural

c. cyclical

Persons in the civilian labor force fall into one of two categories: ____________ or ___________. Question 8 options: a. job leaver; job loser b. entrant; reentrant c. employed; unemployed d. discouraged workers; encouraged workers

c. employed; unemployed

The number of employed persons plus the number of unemployed persons equals the number of persons Question 2 options: a. in the total population. b. in the civilian noninstitutional population. c. in the civilian labor force. d. not in the labor force. e. none of the above

c. in the civilian labor force.

A(n) __________ is a person who was previously employed, hasn't worked for some time, and is currently reentering the labor force. a. discouraged worker b. entrant c. reentrant d. job loser e. job leaver

c. reentrant

Juan lost his job as a nuclear physicist working for a defense contractor. He can not find a job because no firms in the defense industry or any other industry are hiring people with his skills. Juan is ______________ unemployed. a. frictionally b. cyclically c. structurally d. naturally

c. structurally

In year 1 the CPI is 175, and in year 2 the CPI is 189. If Dennis's salary was $82,000 in year 1, what is the minimum salary he must earn in year 2 to "keep up with inflation"? Question 20 options: a. $83,550 b. $92,360 c. $85,750 d. $88,560

d. $88,560 (guess)

Refer to Exhibit 6-3. Prices changed by ___________ percent between year 1 and year 2. a. -1.6 b. -1.7 c. 1.6 d. -2.3 e. 2.3

d. -2.3

Suppose there are 65 million employed persons, 5 million unemployed persons, and 35 million persons not in the labor force. What does the civilian noninstitutional population equal? Question 16 options: a. 70 million b. 110 million c. 65 million d. 105 million

d. 105 million ( i think )

Suppose the civilian non-institutional population equals 250,000; there are 132,500 employed persons and 10,000 unemployed persons. How many persons are not in the labor force? Question 4 options: a. 122,500 b. 77,500 c. 63,500 d. 107,500

d. 107,500

If the CPI was 196.5 in 2005 and 172.2 in 2000, by what percentage did prices rise during the period 2000-2005? Question 13 options: a. 0.10 percent b. 6.43 percent c. 10 percent d. 14.1 percent

d. 14.1 percent

Suppose the market basket consists of 100X, 200Y, and 300Z. Current-year prices are $5 for each unit of X, $2 for each unit of Y, and $3 for each unit of Z. Base-year prices are $2 for each unit of X, Y, and Z. What is the approximate CPI in the current year? a. 15 b. 70.20 c. 1,200 d. 150

d. 150

Suppose that in an economy the structural unemployment rate is 1.1 percent, the frictional unemployment rate is 3.3 percent, and the unemployment rate is 3.1 percent. The natural unemployment rate is _________ percent and the cyclical unemployment rate is ___________ percent. a. 7.5; 4.4 b. 0.2; 9.9 c. 4.4; -1.3 d. 2.2; 3.1

d. 2.2; 3.1 (guess0

In an economy with 200 million people, 140 million hold civilian jobs and 9 million are not working but are looking for jobs. The unemployment rate is a. 6.4% b. 6.0%. c. 9.2%. d. 27.4%. e. 4.5%

d. 27.4%. (GUESS)

Suppose that in an economy the structural unemployment rate is 2.2 percent, the natural unemployment rate is 5.3 percent, and the cyclical unemployment rate is 2 percent. The frictional unemployment rate is _________ percent and the actual unemployment rate (in this economy) is ___________ percent. a. 7.5; 3.3 b. 4.2; 11.7 c. 7.3; 3.1 d. 3.1; 7.3

d. 3.1; 7.3 ( GUESS )

In an economy with a population of 100 million persons, 40 million hold civilian jobs and 9 million are not working but are looking for a job. The number of persons in the civilian labor force is Question 13 options: a. 51 million. b. 60 million. c. 91 million. d. 49 million.

d. 49 million. (GUESS)

The answer is "a person employed in the civilian labor force who quits his or her job." The question is: a. Who is a job loser? b. Who is an entrant? c. Who is a reentrant? d. Who is a job leaver? e. Who is a discouraged worker?

d. Who is a job leaver?

Which of the following statements is false? Question 3 options: a. The sum of the unemployment rate and the employment rate always equals 100 percent. b. The sum of the number of employed persons and the number of unemployed persons equals the civilian non-institutional population. c. The labor force participation rate equals the number of persons in the civilian labor force divided by the number of persons in the total population. d. a, b, and c

d. a, b, and c

Which of the following statements is true? Question 15 options: a. Base year prices are necessarily higher than current year prices. b. The CPI in the base year is always 100. c. If the CPI is 112 in year 1 and 123 in year 2, prices have risen by approximately 9.8 percent between the two years. d. b and c e. a, b, and c

d. b and c

In automobile manufacturing, many parts of the production process that were once completed by people are now completed using robotics. Workers who lost their jobs as a result of the use of robotics became __________ unemployed. a. frictionally b. structurally c. naturally d. cyclically

d. cyclically

The labor force participation rate (LFPR) equals the number of Question 6 options: a. employed persons divided by the number of unemployed persons. b. unemployed persons divided by the civilian noninstitutional population. c. employed persons divided by the civilian labor force. d. employed persons divided by the civilian noninstitutional population. e. none of the above

d. employed persons divided by the civilian noninstitutional population. ( GUESS BUT I'm 80% sure )

Unemployment that arises as a result of the time it takes for unemployed people to locate a job utilizing their transferable skills is called __________ unemployment. a. structural b. cyclical c. natural d. frictional

d. frictional

Jones lost his job in industry A, but he has skills that can be transferred to industry B (which is currently hiring). Smith lost a job in industry C, but his skills cannot be transferred to industry B or to any other industry. Jones is __________ unemployed and Smith is __________ unemployed. a. structurally; frictionally b. structurally; structurally c. frictionally; frictionally d. frictionally; structurally

d. frictionally; structurally

Every ____________ the U.S. government surveys ______________ of households to gather information about the number of Americans unemployed. Question 1 options: a. month; millions b. week; millions c. week; thousands d. month; thousands

d. month; thousands

In year 1 the CPI is 180, and in year 2 the CPI is 192. From year 1 to year 2, Javier's salary rises from $40,000 to $42,000, and Tom's salary rises from $55,000 to $57,000. Who is "more than keeping up with inflation"? a. Javier b. Tom c. both Tom and Javier d. neither Tom nor Javier

d. neither Tom nor Javier

The base year is the year Question 7 options: a. in which prices are unstable. b. in which prices are lowest. c. in which prices are highest. d. that serves as a reference point or benchmark. e. in which nominal output is largest.

d. that serves as a reference point or benchmark.

"Full employment" is said to exist when the unemployment rate a. equals a. zero. b. the cyclical unemployment rate. c. the structural unemployment rate. d. the natural unemployment rate.

d. the natural unemployment rate.

Suppose the civilian non-institutional population equals 100,000 persons; the civilian labor force equals 75,000 persons; there are 70,000 employed persons and 5,000 unemployed persons. If 5,000 persons who are currently "not in the labor force" decide to join the civilian labor force, and 3,000 of them are unemployed, then a. both the unemployment and the employment rate rise. b. both the unemployment and the employment rate fall. c. the unemployment rate rises and the employment rate falls. d. the unemployment rate falls and the employment rate rises.

d. the unemployment rate falls and the employment rate rises.

Exhibit 6-2 Refer to Exhibit 6-2. How many persons are not participating in the labor force in year 2? a. 200 million b. 50 million c. 75 million d. 175 million e. 100 million

e. 100 million

Refer to Exhibit 6-2. How many persons are unemployed in year 2? Question 17 options: a. 200 million b. 50 million c. 75 million d. 175 million e. 100 million

e. 100 million ( guess )

Look at the following data: Employed persons = 110 million; civilian labor force = 135 million persons; civilian noninstitutional population = 190 million. The unemployment rate is __________ percent and the employment rate is __________ percent. Question 4 options: a. 10; 69 b. 8; 57.9 c. 18.5; 57.9 d. 18.5; 81.5 e. 12; 88

e. 12; 88 (guess)

Exhibit 6-2 Refer to Exhibit 6-2. The unemployment rate in year 2 is a. 75 percent. b. 33 1/3 percent. c. 50 percent. d. 66 2/3 percent. e. 25 percent.

e. 25 percent. (GUESS)

Refer to Exhibit 6-2. The employment rate in year 2 is a. 12 1/2 percent. b. 75 percent. c. 87 1/2 percent. d. 30 percent. e. 50 percent.

e. 50 percent.

Refer to Exhibit 6-2. The labor force participation rate in year 3 is Question 12 options: a. 12 1/2 percent. b. 70 percent. c. 80 percent. d. 30 percent. e. 50 percent.

e. 50 percent.

Which of the following statements is false? a. A discouraged worker is counted as an unemployed worker. b. The frictional unemployment rate is greater than the natural unemployment rate. c. The natural unemployment rate is greater than the structural unemployment rate. d. The natural unemployment rate is equal to the sum of the frictional unemployment rate and the structural unemployment rate. e. a and b

e. a and b