Week 2 Reading Quiz Chs. 6 & 8

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Question #1

Employees at a toy-manufacturing factory are let go because robots have been installed to replace humans. What type of unemployment faces the laid-off workers?

A Frictional

B Seasonal

C Cyclical

D Structural

Question #2

How do economists define unemployed workers?

A Not currently working

B Not currently working but actively searching for work

C Although currently working, they are not happy with their current job

D Working on contract for a limited time

Question #3

Based on the information in the table below, calculate the labor force participation rate, and the percentage or workers out of the labor force:

Total adult population over the age of 16 83 million
Total in the labor force 63 million
Total Employed 60 million
Total Unemployed 3 million
Total out of the labor force 20 million

A Participation rate: 24.1%, Out of the labor force: 92.5%

B Participation rate: 75.9%; Out of the labor force: 24.1%

C Participation rate: 5%,Out of the labor force: 15%

D Participation rate: 24.1%, Out of the labor force:75.9%

Question #4

Workers at a car-manufacturing plant in Detroit, Michigan are laid off because of a recession in the economy. The workers’ resulting unemployment can be described as:

A Cyclical

B Structural

C Frictional

D Seasonal

Question #5

When most workers are classified as not being in the labor force, when in reality they are actively searching for work, then the unemployment rate will be

A Either understated or overstated

B Overstated

C Understated

D Neither understated nor overstated

Question #6

If you work part-time when you would like to work full time, or have a full-time job that doesn’t utilize all your skills and talents, then you are counted as:

A Structurally unemployed

B Frictionally unemployed

C A discouraged worker

D Underemployed

Question #7

Miriam is actively searching for a new job after she voluntarily quit her job. Miriam is now considered:

A Not eligible for future employment

B Cyclically unemployed

C Structurally unemployed

D Frictionally unemployed

Question #8

Based on the information in the table below, calculate the unemployment rate:

Total adult population over the age of 16 83 million
Total in the labor force 63 million
Total Employed 60 million
Total Unemployed 3 million
Total out of the labor force 20 million

A 3.61%

B 4.76%

C 31.70%

D 75.90%

Question #9

Assume that in the year 2010, the US Nominal GDP was $15 trillion, while the GDP deflator was 200. Calculate the US Real GDP for 2010.

A $30 trillion

B $300 trillion

C $7.5 trillion

D $0.75 trillion

Question #10

Based on the following data, GDP would equal ___ while Net National Product equals ___

(in Billions)
Government Purchases $20
Exports $5
Imports $10
Depreciation $5
Investments $25
Consumption $70
Domestic US businesses production abroad $15
Foreign businesses production in US $6

A $110 billion; $101 billion

B $130 billion; $139 billion

C $110 billion; $114 billion

D $130 billion; $121 billion

Question #11

Which statement best describes the difference between Nominal and Real GDP?

A Real GDP is Nominal GDP which has been adjusted to remove the distorting effects of inflation.

B Real GDP is calculated using current market prices, while Nominal GDP is calculated using the average prices of the last 5 years.

C Nominal GDP is Real GDP that has been adjusted to remove the distorting effects of inflation.

D Nominal GDP is calculated using current market prices, while Real GDP is calculated using the prices of the previous year.

Question #12

Based on the GDP information in the table below for 2 countries:

Country A: GDP per capita in 2020 -$30,000
Country B: GDP per capita in 2020 -$25,000

Country A: GDP per capita in 2021 -$32,000
Country B: GDP per capita in 2021 -$30,000

A Countries A and B have improved their standard of living in 2021 but A has higher standards of living than B.

B Countries A and B have improved their standard of living in 2021, but A’s living standards have lowered compared to B.

C Country B has a higher GDP in 2021 than country A.

D Country A has improved their standard of living in 2021 more than country B.

Question #13

In 2010, the country of Utopia experienced the highest contraction of their economy at 10% in the previous 20 years before a new expansion phase. In 2010, the economy of Utopia…

A Had reached a peak.

B Was in a recovery phase.

C Had reached a trough.

D Was in an expansion phase.

Question #14

Assume the real GDP of Brazil in 2020 was R 6 billion (Real).
If the exchange rate was 1 Real = $0.25, calculate the real GDP of Brazil in US dollars in 2020.

A $4 billion

B $2.4 billion

C $1.5 billion

D $24 billion

Question #15

Select the statement below which highlights the role of real GDP: “The growth in real GDP has been much lower than expected over the last few years and…

A The country is currently in a mild but lasting recession.

B The government needs to adjust how GDP is being measured

C Unemployment has been rising as a result creating hardship for many in the country.

D Inflation is making the growth numbers more optimistic.

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Week 2 Reading Quiz Chs. 6 & 8

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