Econ Chapter 7 Module

Suppose the CPI in 2008 was 215.3 and the CPI in 2009 was 214.6, what was the inflation rate between 2008 and 2009?

-0.3 percent

Suppose you are available for work but have not looked for a job for at least the last four weeks because you believe that no jobs are available. You would then be counted as __________?

A discouraged worker

The short-term unemployment that arises from workers, in the process of changing jobs, is called __________?

Frictional unemployment

The consumer price index __________?

Measures the cost of an unchanging basket of goods and services.

If the CPI was 207 in 2007 and 225 in 2011, what pay raise would someone who earned $50,000 in income in 2007 have to receive in order to keep her purchasing power constant in 2011?

$4,383

If the cost of a market basket of goods in 1992, the base year, is $200, and the cost of the same market basket is $300 in 2008, what is the CPI in 2008?

150

Which of these persons is officially unemployed?

A non-working individual who has looked for a job in the past week.

A sustained decrease in the average level of prices and wages in the economy is __________?

Called deflation

When the economy is at full employment, which types of unemployment remain?

Frictional and structural

The unemployment that occurs with the normal workings of the economy, such as workers taking time to search for suitable jobs and firms taking time to search for qualified employees, is called?

Frictional unemployment

The "normal or natural" underlying level of unemployment in the economy is the __________?

Full employment rate of unemployment

Unemployment arising from a persistent mismatch between the skills and characteristics of workers and job requirements is called __________?

Structural unemployment

Which of these groups is included in the labor force?

The unemployed

If the consumer price index was 73 in 1979 and 225 in 2011, then prices in 2011 were on average?

Three times as high as 1979

Which market basket specifically targets intermediate goods?

The basket used by the producer price index.

At full employment, __________?

Cyclical unemployment is zero

Which of these is true about the history of U.S. inflation rates?

After remaining relatively flat for 60 years, the price level began to increase steadily after World War II.

According to the graph, at what point does the economy begin a period of recession?

After the peak

The percentage rate of change in the price level is the definition of the?

Inflation rates

The ratio of the labor force to the adult population is known as the?

Labor force participation rate

In calculating the CPI, the __________?

Market basket does not include large equipment purchased by firms.

Which one of these groups in most hurt by unanticipated inflation?

Wealthy people who hold cash in their wall safes.

If inflation is anticipated, __________?

it costs less to society than if unanticipated.

The producer price index tracks the prices firms receive for goods and services at?

All stages of production

The cycle of short-term ups and downs in the economy is called?

The business cycle