Macroeconomics Chapter 29

A college graduate using the summer following graduation to search for a job would best be classified as:

a part of frictional unemployment.

The rate of unemployment when the economy is at its potential output is called the:

natural rate of unemployment.

In which of the following cases would real income rise?

nominal income rises by 2 percent, and the price level remains unchanged.

If actual GDP is $340 billion and there is a positive GDP gap of $20 billion, potential GDP is:

$320 million.

If the annual inflation rate is 5 percent a year, about how many years will it take for the price level to double?

14 years

A nation has a population of 300 million people. Of these, 80 million are retired, in the military, in institutions, or under sixteen years old. There are 210 million who are employed and 10 million who are unemployed. What is the unemployment rate?

4.5 percent

Kevin has lost his job in an automobile plant because of the use of robots for welding on the assembly line. Kevin plans to go to technical school to learn how to repair microcomputers. The type of unemployment Kevin is faced with is:

Structural

The industries or sectors of the economy in which business cycle fluctuations tend to affect output the most:

capital goods and durable consumer goods.

In which phase of the business cycle will the economy most likely experience rising real output and falling unemployment rates?

expansion

During periods of full employment the:

unemployment rate for African-Americans is about twice the rate for whites.