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The growth of output per worker, or "labor productivity," during the past forty years shows:
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| An upward trend from the 1950s to the 1970s, then a downward trend from the 1970s to the 1990s. |
| Faster growth from the 1950s to the 1970s than from the 1970s to the 1990s. |
| Faster growth from the 1970s to the 1990s than from the 1950s to the 1970s. |
| A steady and stable upward trend with a virtually constant rate of growth during the 40-year period. |
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Which of the following would result in an increase in output?
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| The addition of more workers. |
| The addition of more machines. |
| An increase in the length of the workweek. |
| An increase in the quality of the workers or the quality of the machines. |
| All of the above. |
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Which of the following expressions is the unemployment rate?
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Which of the following statements is correct?
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| Both the unemployment rate and the labor-force participation rate have grown steadily since 1953. |
| Both the unemployment rate and the labor-force participation rate have declined steadily since 1953. |
| Since 1953, the unemployment rate has grown steadily, but the labor-force participation rate has gone up and down. |
| Since 1953, the unemployment rate has gone up and down, but the labor-force participation rate has grown steadily. |
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Unemployment rates in the United States are:
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| Practically the same across demographic groups. The burden of unemployment is not squarely associated with any particular demographic group. |
| Highest among African American teenagers. |
| Highest among two-income households. |
| Low in all regions if the national unemployment rate is low. |
| Practically nonexistent. |
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Which of the following facts is/are true about unemployment?
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| An increase in the amount of discouraged workers lowers the unemployment rate. |
| The average duration of unemployment in the United States for the past 20 years has been between 10 and 20 weeks. |
| The average duration of unemployment rises during recessionary periods. |
| All of the above. |
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Cyclical unemployment can best be described as
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| The increase in unemployment above the natural rate during and in the aftermath of recessions. |
| The increase in unemployment when the economy is in a boom. |
| The unemployment associated with workers' lack of skills. |
| The amount of unemployment when real and potential GDP are equal. |
| The amount of unemployment when real and nominal GDP are equal. |
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Unemployment that results from the normal workings of the labor market is a combination of:
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| Frictional and structural unemployment. |
| Cyclical and structural unemployment. |
| Frictional and cyclical unemployment. |
| Higher quantity demanded and lower quantity supplied in the labor market. |
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Structural unemployment occurs because
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| Inflation rises. |
| People have insufficient skills to be employed in the "new economy." |
| The economy suffers from recessions. |
| It takes time to find a job. |
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Which of the following is the best example of an unemployed person?
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| A person looking for work. |
| A person without a job. |
| A person working but not as many hours as s/he would prefer. |
| Any person without a job while looking for work. |
| All of the above. |
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Suppose that an individual is working at home without pay. That person would be counted as
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| Employed. |
| Unemployed. |
| Not in the labor force. |
| Self employed. |
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The natural rate of unemployment is:
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| The unemployment rate related to the business cycle. |
| The unemployment rate when the economy is in a boom. |
| The unemployment rate when the economy is in a recession. |
| The unemployment rate that prevails when actual real GDP is equal to potential GDP. |
| The unemployment rate when real and nominal GDP are equal. |
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Which of the following statements concerning inflation is/are correct?
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| A one-time increase in the price of one good may not be considered inflation. |
| Inflation does not discriminate; it hurts everyone equally. |
| During inflationary periods, incomes and prices usually tend to increase at the same rate. |
| Inflation may actually benefit some people, particularly those on fixed incomes. |
| All of the above. |
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Which of the following characteristics are associated with the Consumer Price Index?
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| The consumer price index measures the prices of all consumer goods in the economy during a given period. |
| The consumer price index tends to overstate changes in the cost of living. |
| The consumer price index can detect the consumers' substitution away from high-priced goods. |
| To construct the price index, the Bureau of Labor Statistics selects at random, each month, different quantities of different goods to determine price changes. |
| All of the above. |
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Which of the following is/are true statements about the impact of inflation on the economy?
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| Unanticipated inflation hurts more than anticipated inflation. |
| Higher than expected inflation hurts creditors but benefits debtors. |
| Inflation creates inefficiency in the economy because it forces people to search for prices when they could be doing something else. |
| Inflation can lead to a misallocation of resources because people tend to make mistakes when there is inflation in the economy. |
| All of the above. |
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The interest rate stated in a loan contract is:
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| The real rate of interest. |
| The nominal rate of interest minus the rate of inflation. |
| The real rate of interest plus the rate of inflation. |
| The same as the rate of inflation. |
| None of the above. |
