Econ HW 8 review

If the GDP deflator is​ 142, by how much have prices changed since the base​ year? A. Prices have increased by​ 42%. B. Prices have increased by​ 58%. C. Prices have decreased by​ 4.2%. D. Prices have increased by​ 142%.

Prices have increased by​ 42%.

Which of the following cause the unemployment rate as measured by the Bureau of Labor Statistics to overstate the true extent of​ joblessness? A. counting people as employed who are working part​ time, although they would prefer to be working full time B. discouraged workers C. inflation D. unemployed persons falsely report themselves to be actively looking for a job

unemployed persons falsely report themselves to be actively looking for a job

An inflation rate of​ 5% between 2019 and 2020 would be implied by a change in the GDP deflator from​ ________ in 2019 to​ ________ in 2020. A. ​375; 390 B. ​200; 205 C. ​400; 420 D. ​105; 115

​400; 420

During a business cycle​ expansion, total production​ ________ and total employment​ ___________. A. decreases; decreases B. ​decreases; increases C. increases; decreases D. ​increases; increases

​increases; increases

Which of the following transactions would be included in the official calculation of​ GDP? A. A student buys a used textbook at the bookstore. B. You buy a new iPod. C. Firestone sells​ $2 million worth of tires to General Motors. D. You wash and wax your​ father's car as a favor to him.

You buy a new iPod.

Which of the following transactions represents the purchase of a final​ good? A. Your father buys a new John Deere riding lawn mower. Your answer is correct. B. The purchase of coffee beans by Starbucks. C. Apple computer buys computer processors from Intel. D. Delta buys a new European−made jetliner.

Your father buys a new John Deere riding lawn mower.

Which of the following goods is directly counted in​ GDP? A. the lettuce that Subway purchases for its sandwiches B. the bread that Subway purchases for its sandwiches C. the plastic bags that Subway purchases to wrap its sandwiches D. a 12 inch Subway sandwich purchased by a student

a 12 inch Subway sandwich purchased by a student

Structural unemployment is the result of A. the ups and downs in inflation. B. a slowdown in the economy. C. the search process of matching workers with jobs. D. a persistent mismatch between the skills and characteristics of workers and the requirements of the jobs.

a persistent mismatch between the skills and characteristics of workers and the requirements of the jobs.

Cyclical unemployment is the result of A. the ups and downs in inflation. B. a slowdown in the economy. C. the search process of matching workers with jobs. D. a persistent mismatch between the skills and characteristics of workers and the requirements of the jobs.

a slowdown in the economy.

An example of a final good would be A. a soy latte sold by Starbucks to a student. B. the whipped cream sold to Starbucks. C. the soy milk sold to Starbucks. D. the coffee beans sold to Starbucks.

a soy latte sold by Starbucks to a student.

The labor force is the sum of A. employed workers and individuals not looking for work. B. employed workers and discouraged workers. C. employed workers and unemployed workers. D. unemployed workers and the​ working-age population.

employed workers and unemployed workers.

The natural rate of unemployment is the amount of unemployment A. equal to cyclical unemployment. B. that exists when the economy is in an expansion. C. that exists when the economy goes into recession. D. equal to frictional plus structural unemployment.

equal to frictional plus structural unemployment.

The full−employment rate of unemployment is zero. true or false

false

The natural rate of unemployment consists of frictional unemployment plus cyclical unemployment. true or false?

false

During the Great​ Depression, cyclical unemployment increased as the recession continued. This increase in cyclical unemployment A. increased the natural rate of unemployment. B. had no effect on the natural rate of unemployment. C. could have increased or decreased the natural rate of unemployment. D. decreased the natural rate of unemployment.

had no effect on the natural rate of unemployment.

Upon your graduation from​ college, you find that the economy is in recession and the unemployment rate is relatively high.​ Nonetheless, most Americans in this situation would continue along their career paths looking for a new job because A. looking for work is your only option. B. the wages of college graduates do not fall during recession. C. high unemployment rates do not usually last for very long. D. the cost of additional education is always higher during recession.

high unemployment rates do not usually last for very long.

An advantage of the establishment survey over the household survey of the labor market is that the establishment survey A. includes the number of self−employed persons. B. is based on actual​ payrolls, rather than on unverified answers. C. includes persons employed at newly opened firms. D. provides an estimate of the number of persons unemployed.

is based on actual​ payrolls, rather than on unverified answers.

Which of the following would be directly counted in GDP in​ 2020? A. kitchen cabinets purchased from Home Depot in 2020 to be installed in a house built in 1997 Your answer is correct. B. kitchen cabinets built in​ 1887, extracted from the 1887​ home, and installed in a​ brand-new, country-style home C. kitchen cabinets built in​ 1887, extracted from the 1887​ home, and installed in a farm house built in 1950 D. none of the above

kitchen cabinets purchased from Home Depot in 2020 to be installed in a house built in 1997

A​ full-time student who is not working is categorized as A. unemployed. B. frictionally unemployed. C. a discouraged worker. D. not in the labor force.

not in the labor force.

A lumberjack loses his job because timber cutting restrictions are imposed by the EPA to protect the spotted owl habitat. This lumberjack would be A. cyclically unemployed. B. seasonally unemployed. C. structurally unemployed. D. frictionally unemployed.

structurally unemployed.

If cyclical unemployment is eliminated in the​ economy, then A. the unemployment rate is below the natural rate of unemployment. B. the unemployment rate is above the natural rate of unemployment. C. the economy is considered to be at full employment. D. the economy is at less than full employment.

the economy is considered to be at full employment.

The unemployment rate is A. the percentage of the​ working-age population that is unemployed. B. the percentage of the labor force that is employed. C. the percentage of the labor force that is unemployed. D. the percentage of the number employed that is unemployed.

the percentage of the labor force that is unemployed.

Frictional unemployment is the result of A. the ups and downs in inflation. B. a slowdown in the economy. C. a persistent mismatch between the skills and characteristics of workers and the requirements of the jobs. D. the search process of matching workers with jobs.

the search process of matching workers with jobs.

According to the​ text, economists consider full employment to occur when A. everyone who wants a job has a job. B. frictional unemployment equals zero. C. the sum of frictional unemployment and structural unemployment equals zero. D. the unemployment rate consists of only frictional and structural unemployment.

the unemployment rate consists of only frictional and structural unemployment.

When the labor market is at full employment A. there is only structural unemployment in the economy. B. the unemployment rate is​ 0%. C. there is only cyclical unemployment in the economy. D. there is no cyclical unemployment in the economy.

there is no cyclical unemployment in the economy.

Which of the following is an example of a worker experiencing frictional​ unemployment? A. A United Airlines pilot loses her job because of lack of demand for air travel. B. A computer programmer loses her job because it is outsourced to India. C. A worker quits his job at the U.S. Post Office to find more interesting work. D. An employee is laid off because the economy is suffering a recession.

A worker quits his job at the U.S. Post Office to find more interesting work.

The nominal GDP of the United States in 2019 was approximately​ $21.7 trillion. This means that A. the value of output in 2019 was around​ $21.7 trillion. B. total spending in 2019 was around​ $21.7 trillion. C. total income in 2019 was around​ $21.7 trillion. D. All of the above are true.

All of the above are true.

Since the end of World War​ II, each president running for reelection when the economy was growing has​ won, and each president running for reelection when the economy was contracting has lost. These presidents were experiencing the political effects of A. inflation. B. depreciation. C. the business cycle. D. the underground economy.

The business cycle.

The labor force participation rates of women have rapidly increased since 1948. true or false?

True

Minimum wage laws cause unemployment because the legal minimum wage is set A. above the market​ wage, causing labor demand to be less than labor supply. B. above the market​ wage, causing labor demand to be greater than labor supply. C. below the market​ wage, causing labor demand to be less than labor supply. D. below the market​ wage, causing labor demand to be greater than labor supply.

above the market​ wage, causing labor demand to be less than labor supply.

​Investment, as defined by​ economists, would not include which of the​ following? Ford A. buys U.S. government bonds. Your answer is correct. B. buys a new robotic machine​ (from a plant in​ Ohio) to assemble cars. C. adds​ 1,000 new cars to inventories. D. builds another assembly plant in the United States.

buys U.S. government bonds.

Which of the following is not a durable​ good? A. automobile B. refrigerator C. clothing D. furniture

clothing

If you have trouble finding a job because of a slowdown in the overall​ economy, we would say that you are A. frictionally unemployed. B. cyclically unemployed. Your answer is correct. C. seasonally unemployed. D. structurally unemployed.

cyclically unemployed.