5 Written Questions

1. unemployment that rises during economic downturns and falls when the economy improves
2. an official count of the population
3. unemployment that occurs as a result of harvest schedules or vacations, or when industries slow or shut down for a season
4. the rate of inflation excluding the effects of food and energy prices
5. theory that inflation occurs when demand for goods and services exceeds existing supplies

5 Matching Questions

1. Underemployed
2. Wage-price spiral
3. Consumer Price Index (CPI)
4. Discouraged worker
5. Deflation

1. a a price index determined by measuring the price of a standard group of goods meant to represent the "market basket" of a typical urban consumer
2. b a person who wants a job but has given up looking
3. c the process by which rising wages cause higher prices, and higher prices cause higher wages
4. d working at a job for which one is over-qualified, or working part-time when full-time work is desired
5. e a sustained drop in the price level

5 Multiple Choice Questions

1. a measurement that shows how the average price of a standard group of goods changes over time
   1. Census
   2. Price index
   3. Fixed income
   4. Market basket
2. the percentage of people who live in households with income below the official poverty line
   1. Poverty rate
   2. Poverty threshold
   3. Inflation rate
   4. Unemployment Rate
3. the level of employment reached when there is no cyclical unemployment
   1. Underemployed
   2. Cyclical unemployment
   3. Unemployment Rate
   4. Full employment
4. the percentage rate of change in price level over time
   1. Deflation
   2. Core inflation rate
   3. Inflation
   4. Inflation rate
5. theory that too much money in the economy causes inflation
   1. Poverty threshold
   2. Cost-push theory
   3. Demand-pull theory
   4. Quantity theory

5 True/False Questions

1. Purchasing power → a measurement that shows how the average price of a standard group of goods changes over time

   True        False

2. Cost-push theory → theory that inflation occurs when demand for goods and services exceeds existing supplies

   True        False

3. Hyperinflation → a general increase in prices

   True        False

4. Structural unemployment → unemployment that occurs when people take time to find a job

   True        False

5. Inflation → a sustained drop in the price level

   True        False