Chapter 23 Self-test questions

* not completed

One weakness of the claimant count as a measure of unemployment is __________

It often overestimates the number of unemployed people correct incorrect

It does not capture those who are unemployed but are not receiving benefits correct incorrect

It is very difficult to calculate correct incorrect

It is out-moded correct incorrect

* not completed

A major shortcoming of the ILO measure of unemployment is __________

It measures all employed workers as if they were all working the same number of hours correct incorrect

It is not applicable to every country correct incorrect

It is prone to too many errors correct incorrect

None of the above correct incorrect

* not completed

Business cycles are associated with __________

High inflation correct incorrect

Periods of rising and falling economic growth correct incorrect

Periods of business profits and losses correct incorrect

None of the above correct incorrect

* not completed

When real GDP falls continuously for two quarters, it is called __________

Business cycle correct incorrect

Stagflation correct incorrect

Recession correct incorrect

Depression correct incorrect

* not completed

Investment affects the stability of aggregate demand more than consumption because _________

Investments are often higher than consumption correct incorrect

Investments are more unstable than consumption correct incorrect

Investments tend to reduce over time correct incorrect

Investments matter more for GDP than consumption correct incorrect

* not completed

The accelerator theory suggests that investment is determined by __________ GDP

Per capita correct incorrect

Level of correct incorrect

Changes in correct incorrect

Size of correct incorrect

* not completed

If a sufficient number of firms start investing because they believe business conditions will improve, it is their actions that may spark the anticipated positive conditions. This is an example of a __________

Self-realizing expectation correct incorrect

Business luck correct incorrect

Unintended consequences correct incorrect

Multiplier effect correct incorrect

* not completed

The kind of unemployment that occurs during the interval period as someone moved from one job to another is called __________

Demand-deficient unemployment correct incorrect

Cyclical unemployment correct incorrect

Frictional unemployment correct incorrect

Structural unemployment correct incorrect

* not completed

The kind of unemployment where engineers cannot find work because the vacancies available require accountants is called __________

Structural unemployment correct incorrect

Mistaken unemployment correct incorrect

Cyclical unemployment correct incorrect

Rigid unemployment correct incorrect

* not completed

No matter how bad a depression gets, aggregate demand will not be zero because __________

There is always some minimum level of spending by consumers, firms and governments correct incorrect

GDP cannot be zero correct incorrect

Of the accelerator principle correct incorrect

Inflation is always present correct incorrect