12. the Consumer Price Index rises from 200 to 222 from one year to the next, th

Question

12. the Consumer Price Index rises from 200 to 222 from one year to the next, the rate of inflation a. 9.9 percent b. 11 percent c. 22 percent d. 222 percent 13. The goal of the consumer price index is to measure changes in a. Cost of production b. Cost of living c. Relative price of consumer goods d. Production of consumer goods 14. If nominal GDP is rising faster than real GDP: The GDP deflator will be increasing b. The GDP deflator wi be decreasing c. The economy is experiencing pure inflation a. d. None of the above 15. Borrowers benefit during periods of unexpected inflation because a. Inflation outpaces wage growth b. The money they pay lenders is worth more than the money they originally borrowed c. Interest rates fal d. The purchasing power of the dollars borrowed is greater than the purchasing power of the dollars repaid to lenders 16. The current cost of the basket of goods included in the CPI is $3883. The cost of the same basket of goods in the base year was $1772. The current CPI is a. 177.2 b. 219 c. 3883 d. 772 17. The unemployment rate equals the number of persons Unemployed divided by the number employed a. b. Unemployed divided by the number if the labor force c. Unemployed divided by the population age 16 and over d. Not working divided by the population age 16 and over Use the following data to answer the next question Population 50 million Number in the labor force 30 million Number employed full time 20 million Number employed part time 8 million 2 million Number unemployed 18. What i s the unemployment rate of the ecomomy? 19. Frictional unemployment means a. 4.0 percent b. 6.7 percent 6.7 percent c. 7.1 percent d. 10.0 a. There are not enough jobs to go around b. Jobs are plentiful but workers are scarce There is a decline in the demand for labor in the aggregate, due to recessionary c. tendencies in the economy d. Imperfect information prevents qualfied workers from matching up with available jobs 20. The recessionary phase of the business cycle is characterized by a. Reduced output and increased unemployment b. Reduced output and reduced unemployment c. Increased output and increased unemployment d. Increased output and reduced unemployment

Explanation / Answer

12. inflation =((222-200)/(200))*100 =11%, so option b

13.option b cost of living, because it compares the value of original bundle at different price levels.

14 a) GDP deflator = Nominal GDP/Real GDP . , So option a.

15. option d, they evaluate the purchasing power of the money.

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