long-term and chronic unemployment that exists even when the economy is producing at a normal rate.
the extra unemployment that occurs during periods of recession.
short-term unemployment that is associated with the process of matching workers with jobs
the additional unemployment not captured in official statistics resulting from discouraged workers and the involuntary part-time workers.
the unemployment that results when people retire or leave the labour force
9. If total output is calculated by adding up the market value of goods and services produced, then more expensive items:
receive a higher weighting than cheaper items.
are excluded from the calculations.
are double counted.
receive the same weighting as cheaper items
receive a smaller weighting than cheaper items.
10. People who enjoy high standards of living usually have all of the following EXCEPT:
higher literacy rates
freedom from scarcity.
more and better consumer goods.
longer life expectancies.
better general health.
11. A higher equilibrium Y and a lower equilibrium i are best explained by _____
an decrease in the money supply
an increase in money demand
an decrease in autonomous expenditure
an increase in the money supply
an increase in autonomous expenditure
12. The unemployment rate equals the number of people:
unemployed plus discouraged workers divided by the number employed.
unemployed.
unemployed divided by the number employed
unemployed divided by the labour force.
unemployed plus discouraged workers divided by the labour force.
13. In Macroland potential GDP equals €500 billion and real GDP equals €515 billion. Macroland has a(n) _________ gap equal to _____ percent of potential GDP.
recessionary; -3
recessionary; 3
expansionary; -3
expansionary; 3
expansionary; -15
14. an decrease in the interest rate ______ IS curve
has no effect on the
causes a movement along the
causes an downward shift in the
causes an upward shift in the
cannot be modelled
15. Cyclical unemployment is:
the extra unemployment that occurs during periods of recession
long-term and chronic unemployment that exists even when the economy is producing at a normal rate.
the additional unemployment not captured in official statistics resulting from discouraged workers and the involuntary part-time workers.
the unemployment that results when people retire or leave the labour force
short-term unemployment that is associated with the process of matching workers with jobs.
16. A decrease in the official value of a currency in a fixed-exchange-rate system is called a(n):
depreciation.
appreciation.
revaluation
devaluation
overvaluation.
17. In the equation Md = kY - hi, where Md is money demand, the parameter k captures _____
the speculative demand for money
the money supply
the effects of inflation
the transactions demand for money
the total demand for money
18. If a certain automotive part can be purchased in Poland for 32 zloty or in Germany for €5.25 and if the nominal exchange rate is 8 zloty per euro, then the automotive part:
is less expensive in Germany
costs more in Poland
is more expensive in Germany
is more expensive in Poland.
costs the same in Poland and Germany
19. Deflating a nominal quantity is the process of dividing a ____ quantity by a ______ in order to express the quantity in ______ terms.
real; price index; nominal
nominal; real quantity; nominal
nominal; price index; real
nominal; nominal quantity; real
real; nominal quantity; real
20. The key assumption of the basic Keynesian model is that in the short run firms ______.
operate just as they do in the long run
adjust prices to bring sales in line with capacity
