Econ 1101 final

Which of the following statements is correct

A nation acquires more capital by saving some of its income and uses it for economic investments

If the prices of all goods and services rose, but the quantity produced remained unchanged, what would happen to nominal and real GDP?

Nominal GDP would rise, but real GDP would be unchanged.

The type of unemployment associated with recessions is called:

cyclical unemployment

If the unemployment rate is 9 percent and the natural rate of unemployment is 5 percent, then the:

cyclical unemployment rate is 4 percent

The number of years required for real GDP to double can be found by:

dividing the annual growth rate into 70

Assume Kyle is temporarily unemployed because he has voluntarily quit his job with company A and will begin a better job next month with company B. Kyle will be considered as:

frictionally unemployed

Kara voluntarily quit her job as an insurance agent to return to school full time to earn an MBA degree. With degree in hand, she is now searching for a position in management. Kara presently is:

frictionally unemployed

Critics of growth argue the following except:

growth cannot be controlled

Before the period of modern economic growth:

rates of population growth virtually matched rates of output growth

Modern economic growth refers to countries that have experienced an increase in:

real output per person. (Per capita)

In the United States, business cycles have occurred against a backdrop of a long-run trend of

rising real GDP

The business cycle depicts

significant fluctuations in economic output and employment

Unemployment involving a mismatch of the skills of unemployed workers and the skill required for current available jobs is called

structural unemployment

natural rate of unemployment is

that rate of unemployment occurring when the economy is at its potential output.

The following are all determinants of growth except

the allocation factor

The unemployment rate is calculated as follows

the number of unemployed people divided by the labor force

Before the advent of modern economic growth, living standards in the world

were relatively stagnant for very long periods of time

Which of the following institutional arrangements is most likely to promote economic growth

Unrestricted trade between nations

According to the Bureau of Labor Statistics, to be officially unemployed a person must:

be in the labor force

Economic growth is best defined as an increase in

either real GDP or real GDP per capita.

In the depth of the Great Depression, the unemployment rate in the United States was approximately

25 percent

cyclical unemployment results from

A decline in total spending on goods and services in the economy

The United States' economy is considered to be at full employment when

About 4-5 percent of the labor force is unemployed

The quality of "human capital" includes

Knowledge, experience, and labor hours

Official unemployment statistics:

understate unemployment because discouraged workers are not counted as unemployed.

UNEMPLOYED 7 TOTAL POPULATION 145 EMPLOYED 95 DISCOURAGED WORKERS 3 The labor force in Econoland is

102 million

FULL TIME EMPLOYED 80 million PART- TIME EMPLOYED 25 million UNEMPLOYED 15 million DISCOURAGED WORKERS 5 million MEMBERS OF UNDERGROUND ECONOMY 6 million CONSUMER PRICE INDEX 110% The unemployment rate is

12.5 percent

Assuming the total population is 100 million, the civilian labor force is 50 million, and 47 million workers are employed, the unemployment rate is:

6 percent

UNEMPLOYED 7 TOTAL POPULATION 145 EMPLOYED 95 DISCOURAGED WORKERS 3 The unemployment rate in Econoland is

6.9 percent

In the United States the rate of unemployment is highest for

African American teenagers

Labour force includes

Employed workers and persons who are officially unemployed

In the modern economic growth process, it is typical to find that

Follower countries can grow faster than leader countries

In 2007-2009, the United States experienced what has come to be known as the:

Great Recession

Gross Domestic Product (GDP) measures and reports output

In dollar amounts

A nation's gross domestic product (GDP):

Is the dollar value of all final goods and services produced within the boarders of the nation

Which of the following does not correctly characterise modern economic growth

It has not affected the average lifespan of human beings

The presents of discouraged workers

May cause the official unemployment rate to understate the true amount of unemployment

Bureau of Labor Statistics (BLS) collects and reports on the number of jobs in the economy. They collect information

Monthly

Alex works in his own home as a homemaker and full-time caretaker of his children. Officially, he is:

Not in the labor force

There are a number of people who fall into a category called "hidden unemployment" they are all of the following except

Students

The unemployment rate that results from the combination or economic, social and political factors which exist at a time of normal economic conditions is called

The natural rate of unemployment

Suppose there are 10 million part-time workers and 90 million full-time workers in an economy. Five million of the part time workers become full- time. As result:

The official unemployment rate will remain unchanged

Why are high rates of unemployment of concern to economists?

There is lost output that could have been produced if the unemployed had been working.

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

a part of frictional unemployment group

Real GDP is preferred to nominal GDP as a measure of economic performance because:

nominal GDP uses current prices and thus may over or understate true changes in output.