Multiple Choice Questions

reports price changes without volatile food and energy prices.
  • Unanticipated inflation
  • Potential output
  • Core inflation
  • Real interest rate
The level of unemployment characterizing the economy in long-run equilibrium, determined by the levels of frictional, structural, and institutionally induced unemployment. At this rate of unemployment, inflation should be constant, so it is sometimes called the nonaccelerating inflation rate of unemployment, or NAIRU.
  • The natural rate of unemployment
  • Natural rate of unemployment (NRU)
  • Which statement is correct?
  • Nominal interest rate
a business cycle.
  • A headline states: "Real GDP falls again as the economy slumps." This condition is most likely to produce what type of unemployment?
  • The headline reads: Steel industry suffers slump as import competiion increases; unemployment rises." This type of unemployment can best be characterized in economic terms as:
  • Which measures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers?
  • The recurrent ups and downs in the level of eocnomic activity extending over several years are a descritpion of:
is the sum of all employed and unemployed adults.
  • Hyperinflation
  • Per-unit production costs
  • Labor force
  • Unemployment rate
Regular income that has not yet been adjusted down to correspond with decreasing purchasing power or up to correspond with inflation.
  • Nominal income
  • Hyperinflation
  • Nominal interest rate
  • Cyclical unemployment
occurs when the unemployment rate moves in the opposite direction as the GDP growth rate.
  • Unanticipated inflation
  • Anticipated inflation
  • Cyclical unemployment
  • Potential output
3.4%
  • A headline states: "Real GDP falls again as the economy slumps." This condition is most likely to produce what type of unemployment?
  • Assuming the total population is 200 million, the labor foce is 100 million, and 92 million workers are employed, the unemployment rate is:
  • If the Consumer Price Index was 166.6 in one year and 172.2 in the next year, then the rate of inflation from one year to the next was:
  • Which measures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers?
a period in which real GDP, income, and employment rise.
  • Okun's law
  • Over a ten-year period, the Consumer Price Index doubled. On the basis of this information we can say that the average annual rate of inflation over this period was approximately:
  • Real income
  • Expansion
refers to the highest level of real Gross Domestic Product output that can be sustained over the long term.
  • Unanticipated inflation
  • Potential output
  • Business cycles
  • Official unemployment rate statistics may:
have usually given up on searching for a job because they found no suitable employment.
  • Business cycles
  • Discouraged workers
  • Anticipated inflation
  • Cyclical unemployment
Cyclical
  • The recurrent ups and downs in the level of eocnomic activity extending over several years are a descritpion of:
  • A headline states: "Real GDP falls again as the economy slumps." This condition is most likely to produce what type of unemployment?
  • Which industry or sector of the economy would least likely be affected by the business cycle?
  • Which measures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers?
Cost-push inflation.
  • A statement that is often used to describe demand-pull inflation is:
  • Which industry or sector of the economy would least likely be affected by the business cycle?
  • Inflation caused by a rise in per unit production costs is referred to as:
  • Inflation is undesirable because it:
8 percent.
  • The recurrent ups and downs in the level of eocnomic activity extending over several years are a descritpion of:
  • A statement that is often used to describe demand-pull inflation is:
  • If the Consumer Price Index was 166.6 in one year and 172.2 in the next year, then the rate of inflation from one year to the next was:
  • Assuming the total population is 200 million, the labor foce is 100 million, and 92 million workers are employed, the unemployment rate is:
Employment and output reach their lowest levels.
  • Cost-push ifnlation may be caused by:
  • A recession is a decline in:
  • A trough in the business cycle occurs when:
  • Official unemployment rate statistics may:
Creditors lose and debtors gain if the lender does not anticipate inflation correctly.
  • Anticipated inflation
  • Real interest rate
  • Cyclical unemployment
  • Unanticipated inflation
causing a severe negative wealth effect and engendering pessimism about the economy's future.
  • Consumer Price Index (CPI)
  • The best example of a "frictionally unemployed" worker is one who:
  • A burst stock market bubble must adversely affect the economy by:
  • Unanticipated inflation
Income of an individual, organization, or country, after taking into consideration the effects of inflation on purchasing power.
  • Okun's law
  • Real income
  • Inflation
  • Recession
output and employment "bottom out" at their lowest levels.
  • Peak
  • Hyperinflation
  • Per-unit production costs
  • Trough
represents workers who want to work but can't find a job, businesses who are reluctant to hire new employees, land being put to sub-optimal use, and banks and credit institutions who accumulate money instead of lending it out.
  • Okun's law
  • GDP gap
  • Inflation
  • Cost-push inflation
$480 billion in potential output.
  • If the natural rate of unemployment was 6 percent, the current unemployment rate was 12 percent, and the nominal GDP was $4,000 billion, then according to Okun's law the economy would have sacrificed:
  • The natural rate of unemployment
  • The headline reads: Steel industry suffers slump as import competiion increases; unemployment rises." This type of unemployment can best be characterized in economic terms as:
  • If the Consumer Price Index was 166.6 in one year and 172.2 in the next year, then the rate of inflation from one year to the next was:
The relationship between an economy's unemployment rate and its gross national product (GNP).
  • Okun's law
  • Deflation
  • Okun's law indicates that for:
  • Inflation
Services.
  • What has been the range for the duration in months of U.S. recessions since 1950?
  • The recurrent ups and downs in the level of eocnomic activity extending over several years are a descritpion of:
  • Assuming the total population is 200 million, the labor foce is 100 million, and 92 million workers are employed, the unemployment rate is:
  • Which industry or sector of the economy would least likely be affected by the business cycle?
is currently between 4.5 and 5.0 because of frictional and structural unemployment.
  • Consumer Price Index (CPI)
  • The natural rate of unemployment
  • Cost-of-living adjustments (COLAs)
  • Full-employment rate of unemployment
arbitrarily redistributes real income and wealth.
  • Cost-push ifnlation may be caused by:
  • Inflation is undesirable because it:
  • The natural rate of unemployment
  • A trough in the business cycle occurs when:
a negative supply shock.
  • Official unemployment rate statistics may:
  • Cost-push ifnlation may be caused by:
  • What has been the range for the duration in months of U.S. recessions since 1950?
  • Cost-of-living adjustments (COLAs)
The Consumer Price Index
  • If the natural rate of unemployment was 6 percent, the current unemployment rate was 12 percent, and the nominal GDP was $4,000 billion, then according to Okun's law the economy would have sacrificed:
  • If the Consumer Price Index was 166.6 in one year and 172.2 in the next year, then the rate of inflation from one year to the next was:
  • Which measures the changes in the prices of a "market basket" of some 300 goods and services purchased by typical urban consumers?
  • The headline reads: Steel industry suffers slump as import competiion increases; unemployment rises." This type of unemployment can best be characterized in economic terms as:
"Too much money chasing too few goods"
  • Inflation caused by a rise in per unit production costs is referred to as:
  • What has been the range for the duration in months of U.S. recessions since 1950?
  • A statement that is often used to describe demand-pull inflation is:
  • The best example of a "frictionally unemployed" worker is one who:
Is equal to the total of fricitonal and structural unemployment
  • Per-unit production costs
  • Full-employment rate of unemployment
  • Natural rate of unemployment (NRU)
  • The natural rate of unemployment
is a decrease in the general price level of goods and services.
  • Deflation
  • GDP gap
  • Okun's law indicates that for:
  • Okun's law
is a time series measure of the price level of consumer goods and services.
  • The natural rate of unemployment
  • Frictional unemployment
  • Consumer Price Index (CPI)
  • Unanticipated inflation
The production of nondurable consumer goods is more stable than the produciton of durable consumer goods over the business cycle.
  • Which statement is correct?
  • Unanticipated inflation
  • Full-employment rate of unemployment
  • Anticipated inflation
A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.
  • Real income
  • Cost-push inflation
  • Over a ten-year period, the Consumer Price Index doubled. On the basis of this information we can say that the average annual rate of inflation over this period was approximately:
  • Okun's law
Structural.
  • Assuming the total population is 200 million, the labor foce is 100 million, and 92 million workers are employed, the unemployment rate is:
  • The recurrent ups and downs in the level of eocnomic activity extending over several years are a descritpion of:
  • If the natural rate of unemployment was 6 percent, the current unemployment rate was 12 percent, and the nominal GDP was $4,000 billion, then according to Okun's law the economy would have sacrificed:
  • The headline reads: Steel industry suffers slump as import competiion increases; unemployment rises." This type of unemployment can best be characterized in economic terms as:
7 percent.
  • Real income
  • Expansion
  • Okun's law indicates that for:
  • Over a ten-year period, the Consumer Price Index doubled. On the basis of this information we can say that the average annual rate of inflation over this period was approximately:
is a period of decline in total output, income, and employment.
  • Over a ten-year period, the Consumer Price Index doubled. On the basis of this information we can say that the average annual rate of inflation over this period was approximately:
  • Real income
  • Recession
  • Expansion
when business activity has reached a temporary maximum.
  • Trough
  • Peak
  • Demand-pull inflation
  • Hyperinflation
is the cost you would physically spend to manufacture a item.
  • Anticipated inflation
  • Real interest rate
  • Per-unit production costs
  • Consumer Price Index (CPI)
is the percentage of the labor force unemployed.
  • Full-employment rate of unemployment
  • Real interest rate
  • Anticipated inflation
  • Unemployment rate
occurs when total spending exceeds the economy's ability to provide output at the existing price level.
  • Demand-pull inflation
  • Frictional unemployment
  • Structural unemployment
  • Anticipated inflation
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Multiple Choice Questions
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