24 terms

# Macroeconomic Chapter 8

#### Terms in this set (...)

Which of the following is an example of cyclical unemployment?
an autoworker is laid off because a recession has caused a decline in sales
Deflation is:
a decreasing aggregate price level
(Table: Employment Data) Look at the table Employment Data. If marginally attached workers are included in the labor force, the labor force is:
all types of workers
Full time employed
Not working but looking
part-time
discouraged workers
The unemployment rate is the:
percent of the labor force that is unemployed.
A drop in the inflation rate is called:
Disinflation
The real wage is the wage rate _____ the price level.
divided by
unemployment rate
#unemployed/ unemployed+employed *100
Income divided by the price level is _____ income.
real
Unanticipated inflation does all of the following EXCEPT:
cause disinflation
Suppose that a bank wishes to make a 5% rate of return on a one-year loan but expects inflation over the course of the loan to be roughly 3%. Which of the following is TRUE?
If the bank charges 8% and the inflation rate is less than 3%, then the bank will have earned a higher rate of return than expected.
Suppose that the nominal rate of interest is 7% and the inflation rate is 3%. The real rate of interest is:
4%
Labor Force
everything EXCEPT discouraged workers and retired workers
The natural rate of unemployment is:
equal to the sum of frictional and structural unemployment
If a country has a working-age population of 200 million, 135 million people with jobs, and 15 million people unemployed and seeking employment, then its unemployment rate is:
10%
(Table: Unemployment and Employment Data) Look at the table Unemployment and Employment Data. If marginally attached workers are included in the labor force and in the unemployment rate, the unemployment rate in this economy is:
add all and then divide by population
When inflation rises quickly, borrowers will _____ and lenders will _____.
benefit;be hurt
will go up
To be classified as unemployed, a person must be:
not working and actively looking for a job in the past four weeks
The _____ interest rate _____.
real;can be zero, positive, or negative
Frictional unemployment exists because of all of the following reasons EXCEPT:
for the minimum wage
labor force is
employed and unemployed looking for work
Suppose the real interest rate is 2.1% and the nominal interest rate is 5.4%. The inflation rate is:
3.3%
The labor force is the total:
number of people who are employed or unemployed
Unanticipated inflation:
reduces the real value of debt