In the typical CPI shopping basket, which of the categories below represents the largest percentage ...

In the typical CPI shopping basket, which of the categories below represents the largest percentage of consumer spending?
 a. housing
 b. food & beverages
  c. transportation
 d. medical care

Question 2

In the unemployment rate, part-time workers are:
 a. not included in the labor force.
 b. included in the labor force, but counted as unemployed.
  c. treated the same way as discouraged workers.
 d. included in the labor force and counted as employed.

Question 3

The existence of discouraged workers:
 a. increases the size of the labor force, but does not affect the unemployment rate.
 b. affects neither the size of the labor force nor the unemployment rate.
 c. may cause the official unemployment rate to understate the true amount of unemployment.
  d. may cause the official unemployment rate to overstate the true amount of unemployment.

Question 4

Suzie Homemaker works in her home as a full-time caretaker and homemaker. Officially, she is:
 a. employed.
 b. unemployed.
 c. not in the labor force.
  d. a discouraged worker.

Question 5

Which of the following is false?
 a. People looking for full-time work who grudgingly settle for a part-time job are counted as employed, even though they are only partly employed.
  b. Some people working in the underground economy could be counted in labor statistics as unemployed, while others may be counted as not in the labor force.
  c. Unemployment rates can be quite different across different segments of the population, as well as varying substantially over time.
  d. None of the above are false; all are true.

Question 6

Which of the following is false?
 a. The unemployment rate is the number of people officially unemployed divided by the civilian labor force.
  b. The labor force includes those people over the age of 14 who are either employed or unemployed.
 c. Discouraged workers, who have not actively sought work for four weeks are not counted as unemployed; instead they fall out of the labor force.
  d. Some people working overtime or extra jobs might be considered to be overemployed.

Question 7

The index of leading economic indicators usually turns downward:
 a. prior to economic expansions.
 b. prior to economic contractions.
 c. prior to a contraction, but then turns upward before the contraction begins.
  d. a full 24 months before a recession begins.

Question 8

The index of leading economic indicators:
 a. provide accurate information on the duration of downturns in the economy.
 b. virtually always predicts downturns in the economy with a lead time of six months.
 c. can result in a self-fulfilling prophecy if business firms respond to leading economic indicator predictions.
  d. provide accurate information on the depth of downturns in the economy.

Question 9

Unemployment rises in ____, and falls in ____.
 a. peaks; troughs
 b. booms; recessions
 c. expansions; contractions
  d. contractions; expansions

Question 10

The type of unemployment that occurs because of a recession is called:
 a. frictional unemployment.
 b. seasonal unemployment.
 c. the natural rate of unemployment.
  d. cyclical unemployment.

Question 11

Which of the following is true?
 a. A depression is a recession that is mild and relatively brief.
 b. The expansions and contractions of real world business cycles last varying lengths of time and often differ in magnitude.
  c. The timing of business fluctuations is regular and therefore easily predictable.
 d. During the contractionary phase of the business cycle, the rate of unemployment is generally quite low.

Question 12

Economists usually use the term recession to refer to:
 a. any slowdown in the growth of real GDP.
 b. zero real GDP growth.
 c. two or more consecutive quarters of declining real GDP.
  d. a reduction in nominal GDP lasting more than six months.