AP Econ ch. 21/ 23

an increase in the price of forklifts imported into the US from Belgium will

have no effect on the consumer price index or the GDP deflator.

suppose a country produces only two goods, picca and soda. Given the information in the table below, nominal GDP real GDP and the GDP deflator in 2005 are

260 130 200

the value of the GDP in 2010 in terms of 2000 prices was

$600

if the negative GDP gap were equal to 6% of the potential GDR the actual unemployment rate would exceed natural rate of unemployment by

3 percentage points

if 2010 were made the base year for the GDP price deflator index, the value of the index number for 200 (rounded to the nearest whole number would be)

42

the unemployment rate in an economy is 8%. the total population of the economy is 250 million and the size of the civilian labor force is 150 million. The number of employed workers is

138 million

which has helped decrease the natural rate of unemployment in the United States in recent years?

a smaller portion of young workers in the labor force

The labor force includes those who are

able and willing to work

in 2010 the us had a trade deficit of $600 billion therefore

americans consumed more than they produced.

which of the following shifts the production possibilities curve outward?

an increase in labor productivity

insufficient total spending in the economy results in

cyclical unemployment

if GDP is declining the economy is most likely in which part of the business cycle?

contradictory

if the natural rate of unemployment is 5.2% and the actual rate of unemployment is 5.7% then by definition there is

cyclical unemployment amounting to 0.5% of the labor force.

the full employment unemployment rate in the economy has been achieved when

cyclical unemployment is zero

the unemployment data collected by the bureau of labor statistics have been criticized because

discouraged workers are not considered

if the cost of the basket of goods and services the bureau of labor statistics uses to calculate the consumer price index rises from $200 in the base period to $400 in the current period, then the consumer price index

equals 200 in the current period

an economy in recession can return to full employment in the long run through

expansionary monetary policy

a worker who has quit one job and is taking two weeks off before reporting to a new job is an example of

frictional unemployment

the natural rate of unemployment

includes structural and frictional unemployment

classical economists believe

int hat the quantity theory of money that both the velocity and the quantity of good and services per period are fairly stable.

The GDP deflator

is used to calculate inflation rises and its alternate to the CPI

which of the following persons is considered to be unemployed?

mary, who has quit her job to look for another one.

the amount of unemployment that an economy normally experiences is called the

natural rate of unemployment

production and employment would be least affected by a severe depression in which type of industry?

nondurable consumer goods

Imagine someone who is not looking for work because they are embarrassed in the interview process when their inability to read is revealed. However this person would take almost any job that was offered. according to the bureau of labor statistics this person is

not in the labor force

most economists believe that the immediate determinant of the levels of domestic output and employment is

the level of total spending

when products improve in quality the CPI will

overestimate the inflation rate

according to experts the CPI

overstates increases in the cost of living

who of the following are included in the bureau of labor statistics employed category?

part time workers and workers on vacation

which of the following policies is most likely to bring about economic growth in the long run?

promoting improvements in the education of the population

suppose taxes are cut in an economy that is in equilibrium at full employment. In the long run the tax cut will

raise the price level

if the cpi goes to 150 from 120 then prices have

risen 25%

a worker who loses a job at a petroleum refinery because consumers and business firms switch from the use of oil to the burning of coal is an example of

structural unemployment

if global warming raises temperatures so high that snow can never again exist anywhere, snow ski instructors will experience

structural unemployment

unemployment that results because the job skills possessed by those in some labor markets may be insufficient to give a job to everyone who wants one is called

structural unemployment

some people who are employed or who are not making serious effort to find employment will report themselves as unemployed. some people who want to find work will be counted as out of the labor force.

the first fact tends to make the reported unemployment rate higher than the actual unemployment rate, whereas the second fact tends to make the reported unemployment rate lower than the actual unemployment rate.

which of the following is not a requirement for the bureau of labor statistics to place someone in the unemployed category?

the person must not have been fired from their previous job

if technology makes production less expensive and at the same time exports decrease, which of the following will result with certainty?

the price level will decrease

potential GDP will fall, certeris paribus, if

the retirement age is lowered

You buy 100 shares in the XYZ company and your broker charges you $29.95

this will increase GDP by $29.95

which of the following is not a type of unemployment?

traditional

the burden of unemployment is least felt by

white collar workers