iVAT Chapter 6

A  The labor force to stay the same because the labor market is in equilibrium at that point.

B  The labor force to decrease as previously discouraged workers choose to remain unemployed.

C  The labor force to increase as previously discouraged workers re-entered the labor force.

D  The labor force to increase because the overall population of the country should increase because of immigration.

E  The labor force to increase because the overall population of the country should shrink.

A  the percentage of people in the economy who are not working.

B  the percentage of people in the economy who are willing and able to work but cannot find jobs.

C  the percentage of the employed people in the economy that become unemployed each month.

D  The dynamic rate of decline

E  the percentage of people in the economy who are willing and able to work full-time but cannot find full-time jobs.

A  Frictional unemployment

B  Fortified unemployment

C  Structural unemployment

D  Full employment

E  Cyclical Unemployment

A  The fact that the economy has hit a long-term equilibrium point.

B  Keynesian fiscal and monetary policies, where overall demand in the economy is managed.

C  Increased trade between Europe and the United States after World War II.

D  The fact that secular growth trends have generally increased since World War II.

E  Classical fiscal policies where laissez-faire policies are implemented.  This can lead to business cycles being dampened and smoothed.

A  Equilibrium

B  A recession

C  Keynesianism

D  A structural stagnation

E  A business cycle

A  Hits an equilibrium point.

B  Hits the peak of the business cycle.

C  Moves past the trough and moves in an upward trajectory.

D  Before it hits the trough or bottom of the business cycle.

E  Is in between the recessionary expansions.

A  India

B  Germany

C  The United States

D  China

A  The differences in amount of exports that both countries produce.  Exports can have a large determining impact on overall living standards.

B  The difference in the consumption patterns between the two nations.

C  The differences in growth rates in the economy, and the large impact that compound growth can have over long time periods.

D  The differences in savings rates between the two countries caused this disparity.  The long-term growth of an economy is dependent on savings from its citizens.

E  Compound growth and its tendency to create very small differences in living standards.

A  The long-term secular growth trend, as opposed to cyclical growth trends.

B  The productive capacity of the economy, which is measured by total investment.

C  Savings per capita, which is savings divided by the population.

D  Per capita output, which is output divided by the population.

A  Sustaining adequate aggregate demand to prevent high rates of unemployment.

B  Creating incentives for for workers to enter the labor force.

C  Creating incentives for businesses to increase rates of investment.

D  Increasing business confidence, so that businesses create jobs.

A  It is referring to a period in an economy where unemployment is high and the economy is simultaneously in a recession.

B  It is referring to a period in an economy where inflation is high and the economy is simultaneously in a recession.

C  It is referring to a period in an economy where inflation is low and the economy is simultaneously in a recession.

D  It is referring to a period in an economy where inflation is high and the economy is simultaneously simultaneously growing rapidly.

A  Workers are likely to resist cuts in their nominal wages.

B  Workers are likely to accept cuts in their nominal wages in order to reduce unemployment.

C  Firms can reduce prices to reach a market equilibrium.

D  Firms are likely to reduce prices if there is an oversupply of goods.

A  Unions, which cause wages to be higher than the market equilibrium wages.

B  An increase in the rates of return on investments.

C  A decrease in the productive capacity of the economy.

D  Decreased confidence by firms due to excessively low wages.

A  Unemployment

B  Creating incentive plans to increase the size of the labor force

C  Increasing the overall productive capacity of the economy

D  Secular growth trends