macro CH7
Which of the following is the definition of the GDP Deflator?
A broad price index measuring the changes in prices of all new goods and services produced
Which of the following is most likely to gain from unanticipated inflation?
A consumer with a five year auto loan.f
Which of the following is the definition of the PCE Index?
A statistica measure of average prices using annually updated weights based on surveys of consu,er spending
Which of the following is the definition of the Consumer Price Index left parenthesis CPI right parenthesis?
A weighted average of prices of a market basket of goods and services that firms produce and sell
Sean is lobster man, but lobster fishing is done only only in the summer months, so he doesn't have a job in the winter. Which type of unemployment is this?
seasonal unemployment
James worked for an automobile plant that has now closed comma as the parts produced are no longer needed. Which type of unemployment is this
structural unemployment
Double click on the graph to the right. Select Multiple Time Series Data. For Y Axis1 select the labor force participation rate of men, and for Y Axis2 select the labor force participation rate of women. After selecting these series the data will be plotted in the graph. According to data shown on the graph on the right, it is clear that the labor force participation rates for men and women in the US
tended to converge over almost the entire period.
The unemployment rate is calculated as
the number of unemployed/the number of people in the labor force x100
Full employment means
there is a level of unemployment consistent with "normal" frictions in the labor market.
The economy of Finlandia is at full employment when
there is some unemployment due to friction in the labor market, but there is no cyclical unemployment.
The nominal value of anything is its price expressed in ________, and the real value of anything is its value expressed in ________
today's dollars; purchasing power
The labor force is equal to the number of employed plus the number of unemployed.
true
Unemployment due to the fact that workers must search for appropriate job offers is called frictional unemployment.
true
If last year a pineapple cost $2, and this year it costs $4, there has been a ________ percent rise in the price of the pineapple over a one-year period.
100
Jim's favorite breakfast is two eggs, 1/5 lb. of bacon, 1/7 lb. of white toast, 1/6 can (16 ounce can) of frozen concentrate orange juice, and 1 lb. of grapefruit. The following table contains 1991 and 2001 prices for these five items. Using 1991 as the base year, compute the price index for Jim's breakfast for 2001
107.5
Jim's favorite breakfast is two eggs, 1/5 lb. of bacon, 1/7 lb. of white toast, 1/6 can (16 ounce can) of frozen concentrate orange juice, and 1 lb. of grapefruit. The following table contains 1991 and 2001 prices for these five items. Using 1991 as the base year, compute the price index for Jim's breakfast for 2001. Item 1991 Price 2001 Price One dozen eggs $1.08 $1.02 One pound bacon $2.15 $2.75 One pound bread $0.63 $0.98 One can orange juice $1.98 $1.86 One pound grapefruit $0.57 $0.55
107.5
Structural unemployment is related to the movement of workers from low-paying to high-paying jobs
False
The values of NGDP for the years 1981 and 1982 are $3.1284 and $3.255 trillion, respectively. The values for RGDP for 1981 and 1982 are $5.2917 and $5.1893 trillion, respectively. According to the graph of NGDP and RGDP and the values of the two time series variables for 1981 and 1982, it is correct to state that
NGDP has always been increasing, but RGDP has been both increasing and decreasing. Between 1981 and 1982, NGDP increased by $.1266 trillion, corresponding to a rate of growth of 4.05%. RGDP decreased by $.1024 trillion, corresponding to a negative rate of growth of 1.94%.
Click on the graph in the window on the right and select Multiple Plots to compare the volatility of four major U.S. price indices over the years 1948-2005. For each Y listbox, select a different option: the Consumer Price Index (CPI), the Producer Price Index (PPI), the Personal Consumption Expenditure Index (PCE) and the GDP deflator. Roll your cursor over each plotted line to identify the data. Which of these price indices shows the greatest price volatility?
PPI
The table on the right shows four major price indices of the US economy: the Consumer Price Index (CPI), the Producer Price Index (PPI), the Personal Consumption Expenditure Index (PCE) and the GDP deflator. All four indices are used to measure inflation. Based on the data from the four indices in the table, which price index suggests the highest rate of inflation between the years 1997 and 1998?
The CPI indicating the highest inflation rate (1.54%)
Which of the following statements is true concerning the historical picture of business activity in the United States?
The frequency and size of fluctuations around the trend has decreased since World War II.
The following table contains information for the U.S. for 2001. |U.S. Economy: 2001 | Thousands of Persons Civilian labor force 143 comma 772 Civilian employment 136 comma 940 Civilian working-age population 215 comma 227 Compute the unemployment rate and the labor force participation rate.
Unemployment rate = 4.75 percent; Labor force participation rate = 66.8 percent.
Internet job sites, like Monster.com, have led potential employees to find jobs via the internet almost instantly. This has caused
a fall in frictional unemployment.
The type of unemployment that rises as the economy goes into a recession is called
cyclical
Marisa has just graduated from college and is seeking a job, but hasn't found one yet. Which type of unemployment is this? A. structural unemployment B. frictional unemployment C. cyclical unemployment D. seasonal unemployment
frictional unemployment
By providing information and reducing the costs of job search, the Internet's impact on the job market is to reduce
frictional unemployment.
Consider an economy with only two groups of people: Wage earners and Goods sellers. If the price level increases by 20% while the nominal wages remains the same,
income will be redistributed from wage earners to goods sellers
Typically during a recession
incomes fall and unemployment rises.
