1. A financial crisis coupled with a recession seems to affect the severity and duration of the recession. How?
a. Financial crises tend to make recessions milder and shorter
b. Financial crises tend to make recessions milder, but last longer
c. Financial crises tend to make recessions longer and more severe
d. Financial crises tend to make recessions more severe, but shorter
2. The endĀĀ of the Great Depression troubled a lot of people. Why?
a. It lasted so long that people actually missed it
b. It disappeared without any warning
c. It ended so slowly that the public thought that was no improvement
d. It never really ended; it was merely interrupted by World War II
e. President Roosevelt said that he had ended the depression, but he was lying
f. The end of the depression coincided with massive inflation
3.
Suppose that you have been asked to compare the problem of bank failures during the Obama recession with the past. How does the number of bank failures in the Obama recession compare to the 1930s or the Reagan recession?
a. the Obama recession had far more bank failures than the Great Depression or the Reagan recession
b. the bank failures of the 1930s were the worst, but the Obama recession was second only to the Great Depression in bank failures
c. bank failures were more numerous in the 1930s and in the Reagan recession
d. many banks failed in the 1930s and the current situation is not quite as bad, but there were no bank failures in the Reagan recession
4.
When we reach full employment in the U.S. economy today, what will the unemployment rate be?
a. 0%
b. 3%
c. 4% - 4.5%
d. 5.0% - 6.0%
e. 10%
5. Which type of unemployment includes a person who has given up looking for a job because he thinks it is just a waste of time?
a. frictional unemployment
b. structural unemployment
c. cyclical unemployment
d. seasonal unemployment
e. voluntary unemployment
f. discouraged workers
6.
Choose the answer that fills-in both blanks: How good was the original fitĀĀ of the data for the Phillips Curve for the U.S. economy in the 1960s? __________ How good was the fit of the data for the Phillips Curve for the U.S. economy after the 1960s? ______________
a. adequate/okay
b. adequate/very good
c. okay/not as good, but still okay
d. adequate/not good
e. very good/even better
f. very good/okay
g. very good/not good
h. very good/very good
7.
In the 20th century, only two countries stood out in terms of robust job creation. The two countries were:
a. China and Japan
b. Germany and France
c. The U.S. and the U.S.S.R.
d. The U.S. and Japan
e. The U.S. and Germany
8. It is very common to see the unemployment rate actually increase as the economy begins to recover (i.e., after the trough). What causes the unemployment rate to rise at this time?
a. structural unemployment increases
b. cyclical unemployment increases
c. seasonal unemployment increases
d. voluntary unemployment increases
e. discouraged workers return to the workforce
9.
Danish labor market reforms are referenced in the Commentary. These reforms attempt to make it easier for firms to hire and fire workers. Which of these two are easier to hire or easier to fire is the primary or critical dimension of the reforms?
a. hire workers
b. fire workers
c. neither hire nor fire workers; the reforms have nothing to do with either
10.
The original Phillips Curve depicted by Almarin Phillips sought to show a relationship between unemployment and _______________. Subsequent versions of the Phillips Curve usually depict a relationship between unemployment and ___________________.
a. real GDP / nominal GDP
b. nominal GDP / real GDP
c. changes in wages/changes in prices (inflation)
d. changes in prices/changes in wages
e. changes in employment/changes in new jobs created
f. changes in new jobs created / changes in employment
g. changes in hat sizes/changes in dress sizes
