MACRO201 chapter 9

Which of these persons is officially unemployed?

A non-working individual who has looked for a job in the past week

unemployed

A non-working individual who has looked for a job in the past week is considered _______________.

cyclical

At full employment, ____________ is zero.

nominal

Economic variables that are calculated in current year prices are referred to as ______________ variables

When the economy is at full employment, which types of unemployment remain?

Frictional and structural

Of the eight categories in the CPI market basket, which three categories make up more than 75% of the basket?

Housing, transportation, and food

less

If inflation is anticipated, it costs ______ to society than if unanticipated.

be a problem

If the inflation rate is anticipated, it may not ____ __ ___________.

nominal, real

If there is zero inflation, the _________ interest rate is equal to the _____ interest rate.

Which of these statements about interest rates and inflation is true?

If there is zero inflation, the nominal interest rate is equal to the real interest rate.

large, firms

In calculating the CPI, the market basket does not include ________ equipment purchased by _______ .

Inflation rate example

Inflation rate = [(CPI1 - CPI0) / CPI0] x 100 = [(225 - 207) / 207] x 100 = 8.696.

housing, transportation and food

Of the eight categories in the CPI market basket, which three categories make up more than 75% of the basket?

unemployment

The "normal or natural" underlying level of unemployment in the economy is the full employment rate of ________________.

natural, real

The ___________ rate of unemployment is the unemployment rate that results when the economy produces the potential level of ______ GDP.

Which market basket specifically targets intermediate goods?

The basket used by the producer price index

unchanging

The consumer price index (CPI) measures the cost of an ______________ basket of goods and services.

producer price index

The market basket used by the ___________ _______ _______ specifically targets intermediate goods.

all stages

The producer price index tracks the prices firms receive for goods and services at _____ ________ of production.

frictional

The short-term unemployment that arises from workers, in the process of changing jobs, is called _____________.

Which of these groups is included in the labor force?

The unemployed

frictional and structural

When the economy is at full employment, which types of unemployment remain?

inflation rate

[(CPI1 - CPI0) / CPI0] x 100

Suppose you are available for work but have not looked for a job for at least the last four weeks because you believe that no jobs are available. You would then be counted as __________.

a discouraged worker

In general, __________ have much lower unemployment rates than other individuals with other levels of education.

college graduates

At full employment, __________.

cyclical unemployment is zero

To obtain prices of a representative group of goods and services, the Bureau of Labor Statistics (BLS) conducts a monthly survey of __________ households nationwide on their spending habits. The results of this survey are used to construct a market basket of __________ types of goods and services purchased by the typical urban family of four.

14,000; 211

net debtors

Unanticipated deflation hurts _____ ____________.

structural

Unemployment arising from a persistent mismatch between the skills and characteristics of workers and job requirements is __________.

real

Variables that have been corrected to account for the effects of inflation are _____ variables.

discouraged worker

available for work but have not looked for a job for at least the last four weeks would be a ____________ ________

The short-term unemployment that arises from workers, in the process of changing jobs, is called __________.

frictional unemployment

In calculating the CPI, the __________.

market basket does not include large equipment purchased by firms

Economic variables that are calculated in current year prices are referred to as __________ variables, while variables that have been corrected to account for the effects of inflation are __________ variables.

nominal, real