Question

Which form of unemployment will probably last the shortest for a given worker?

full unemployment

structural unemployment

frictional unemployment

cyclical unemployment

Question 2

If U.S. Steel Corporation sells sheet metal for car doors to General Motors, the transaction will be counted in the national income accounts as __________.

the sale of a producer good between two producers

a business investment

a temporary investment

nothing; the sheet metal is an intermediate good

Question 3

Which of the following is a result of slow economic growth?

increasing tax revenues

increasing levels of pollution

higher unemployment rates

political and societal tranquility

Question 4

The value of net exports is a positive number in the national income accounts when __________.

capital consumption exceeds net investment

exports exceed imports

imports exceed exports

national income exceeds personal income

Question 5

The presence of discouraged workers—those who want a job but have given up looking for one—may cause __________.

the employment rate to be understated

the unemployment rate to be understated

the employment rate to be overstated

the unemployment rate to be overstated

Question 6

What is the best definition of stagflation?

Economic activity is in decline, with a fall in the price level.

The economy is stagnant (not growing), but there is also inflation.

Economic activity is on the rise but with a fall in the price level.

The economy is growing, but there is also recession.

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Question 7

The consumer price index (CPI) is based on changes in the __________.

cost of all goods that enter into the GDP

cost of a market basket of typical buyer goods

prices consumers are willing to pay

average consumer’s nominal income

Question 8

During and after the Great Depression, economists who refined Keynesian ideas were in favor of __________.

no emphasis on aggregate demand

emphasis on the role of money

activist government involvement in the macroeconomy

rare government involvement in the macroeconomy

Question 9

An economist of the classical tradition would most likely hold all of the following views EXCEPT __________.

demand creates its own supply

an economy tends to full employment

government intervention is rarely needed

the aggregate supply curve is vertical in the long run

Question 10

Many economists believe that the existence of unemployment compensation causes a(n) __________.

increase in the size of the labor force

lower full-time employment level

shorter search time between jobs

longer search time between jobs

Answer 1

Answer 1)Frictional Unemployment last for shortest duration.

Answer 2) Nothing the sheet metal is intermediate goods

Answer 3) Higher Unemployment rate

Answer 4) Exports exceed Imports

Answer 5) The unemployment rate will be understated

Answer 6)The economy is stagnant not growing but there is also an inflation

Answer 7) Cost of market basket of typical buyer goods prices consumer are willing to pay

Answer 8) Rare government involvement in the macroeconomy

Answer 9) The Aggregate supply curve is vertical in long term

Answer 10 ) Lower Full time employment level