Quiz 12

Calculate the unemployment rate based on the following data for a country: Population: 200, Employed workers: 140, Labor Force: 160, Discouraged workers: 10.

12.5%

With a Consumer Price Index of 179.8 at the end of last year and 186.5 at the end of this year, the country experienced which of the following?

An inflation rate of 3.72 percent.

David's pay last year was $100,000. His pay this year increased to $115,000. The consumer price index increased from 100 to 115 over the same time period. What has happened to David's real income from last year to this year?

David's real income is unchanged.

Henry has accepted a new position in the Federal government after working at ball bearing manufacturing plant. He has been put to the task to measure the economic growth as accurately as possible for the nation's last year. What would Henry use in this instance to produce the most accurate growth analysis?

GDP Deflator

Which types of unemployment exist at all times and determine the natural rate of unemployment?

frictional unemployment and structural unemployment

A welder who quits his job and moves from Pittsburgh to Madison to try to get a better welding job is said to be ________.

frictionally unemployed.

The redistribution of purchasing power due to unexpected inflation benefits which group of people?

students with fixed-rate educational loans

The Department of Economic Health in the country of Cavia has calculated the price index for a basket of goods from 2014 to 2018. January 2014 is the standardized price index (at 100) for a basket of consumer goods. The price index increased in 2015 to 105.7, in 2016 to 108.6, in 2017 to 115.9, and in 2018 it increased to 120.4. What are the inflation rates in Cavia for 2015, 2016, 2017, and 2018?

2015: 5.7%; 2016: 2.7%; 2017: 6.7%; 2018: 3.9%

The following table indicates the CPI for the country of Praton over the last four years. Using the information in the table, calculate the annual inflation rates. Which time frame had the lowest annual inflation rate?

2016-2017

If the number of employed persons in a country equals 24 million, the number of unemployed persons equals 8 million, and the number of persons over age 16 in the population equals 40 million, the unemployment rate equals ________.

25%

In 2005 the price index was calculated at 115.3 with 2000 as the base year. In 2006 the price index increased to 119.5. What was the inflation from 2005-2006?

3.6%

In the far off kingdom of Viracien there is a healthy sized population of citizens over 16 years old. The last census indicated a total adult population of 5 million people. This year a recession hit and 237 thousand people were let go from their jobs and are on the hunt to find new work. Because of the recession many took early retirement and there is now a population of 1.3 million who are not working or looking for various reasons. Because of the unrest, the military of Viracein has increased its ranks and is now grown to a total of 50 thousand citizens serving the country. If Viracein uses the same calculation to find the unemployment rate, what is the country's unemployment rate?

6.5%

The Krisp Kracker company which makes unique kettle chips for restaurants, clubs, and events, has just lost a large client that made up 55% of its total revenue. Management finds it necessary to reduce staff or wages. This comes only three months after hiring 35 new people to support this big client. While there are rumors of wage reductions in the short run, the 100 employees who have been with the company for the past two years are grumbling that they are more valuable that the new hires which should be let go and the wages not reduced. The situation at Krisp Kracker illustrates which wage stickiness theory best?

Insider-outsider model

What is excluded from the official calculation of the unemployment rate?

Students who are attending to school full time and not working.

What does the unemployment rate measure?

The percentage of the labor force who do not have a job, but are looking for one.

Cyclical unemployment is caused by the ________ for labor ________ during a recession.

demand; moving to the left

Which of the following goods is likely not to be included in CPI calculations that take 1982-1984 as the base year?

laptop Computers

Which group of people is harmed by the redistribution of purchasing power due to unexpected inflation?

lenders

A year ago Parker reached his retirement and left the business to pursue other interests. He is now spending lots of time playing golf and visiting his grandchildren. For purposes of employment he is considered:

out of the labor force.

If the print media is taken over by the electronic media, thereby causing employees in the print media industry to be permanently laid off, ________ unemployment would increase.

structural