Test 2 set 2

Suppose that dental hygienists are unionized in the eastern region of the country but not in the western region. If the unionized workers in the eastern region abolished their unions, employment

of dental hygienists in the eastern region would rise, but wages of dental hygienists in the eastern region would fall.

When the Fed buys government bonds

the money supply increases and the federal funds rate decreases.

Refer to Table 28-6. What is the U-1 measure of labor underutilization?

1.6%

Suppose that some country had an adult population of about 46 million, a labor-force participation rate of 75 percent, and an unemployment rate of 8 percent. How many people were employed?

31.74 million

Suppose that the adult population is 4 million, the number of unemployed is 0.25 million, and the labor-force participation rate is 75%. What is the unemployment rate?

8.3%

Refer to Table 28-6. What is the U-6 measure of labor underutilization?

9.0%

Suppose that the adult population is 6 million, the number of employed is 3.8 million, and the labor-force participation rate is 70%. What is the unemployment rate?

9.5%

Which of the following would decrease the value of money?

Money demand exceeds money supply

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 otherwise, while the second fact tends to make the reported unemployment rate lower than otherwise.

If the Fed increases the reserve ratio from 5 percent to 12.5 percent, then the money multiplier

decreases from 20 to 8

In a system of 100-percent-reserve banking, the purpose of a bank is to

give depositors a safe place to keep their money

Right-to-work laws

give workers in a unionized firm the right to choose whether to join the union

When there is inflation, the number of dollars needed to buy a representative basket of goods

increases, and so the value of money falls.

The Bureau of Labor Statistics produces data on unemployment

monthly

Suppose the price level rises, but the number of dollars you are paid per hour stays the same. This means that your

real wage is lower

According to the article "Why Gold?', silver may be used as money. One problem with using silver as money is that

silver tarnishes over time

The inflation tax refers to

the revenue a government creates by printing money