iVAT Chapter 6

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

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

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

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

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

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

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

C  The dynamic rate of decline

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

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

A  Cyclical Unemployment

B  Fortified unemployment

C  Full employment

D  Frictional unemployment

E  Structural unemployment

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

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

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

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

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

A  A structural stagnation

B  A business cycle

C  Equilibrium

D  Keynesianism

E  A recession

A  Hits the peak of the business cycle.

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

C  Is in between the recessionary expansions.

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

E  Hits an equilibrium point.

A  India

B  Germany

C  The United States

D  China

A  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.

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

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

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

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

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

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

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

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

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

B  Increasing business confidence, so that businesses create jobs.

C  Creating incentives for businesses to increase rates of investment.

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

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

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

C  It is referring to a period in an economy where unemployment is high 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 in a recession.

A  Firms can reduce prices to reach a market equilibrium.

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

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

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

A  An increase in the rates of return on investments.

B  A decrease in the productive capacity of the economy.

C  Decreased confidence by firms due to excessively low wages.

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

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

B  Unemployment

C  Increasing the overall productive capacity of the economy

D  Secular growth trends