Econ - Unit 7

What term means a period high unemployment and high inflation (thought impossible until the 1970’s when we had it for the first time, hard to fix)?

• Stagflation
• Depression
• Recession
• Inflation

What term means GDP divided by the number of people in the country to find the average income of the people living there?

• Real GDP
• GNP
• GDP per capita
• GNR

Overall, this diagram represents:

•  cyclical inflation 
• the change in CPI 
• the Business cycle
• a cool roller coaster ride 

Tracy has only been employed in one job this year.  She was the Easter Bunny at the mall.  Now, that Easter is over, she is: a.  c. gb. d. 

• cyclically unemployed
• seasonally unemployed
• adjusted unemployed 
• grossly unemployed 

What is the “basket” that is calculated in CPI? 

• Easter eggs and cars 
• Food, drugs and doctor ladies
•  Non-durable goods and services
• Non-durable goods, durable goods, and services

In a recession, the Federal Reserve will typically respond by...

• Keep interest rates the same
•  Lowering interest rates
• Raising interest rates 
• Raise Reserve Requirements

On the business cycle graph, economic contraction is represented by...

• The line going up
• The line going down

The government increasing Cancer research will result in ___________________. 

•  Lower unemployment and economic growth 
• Higher unemployment and economic growth 
• Lower unemployment and an economic contraction
•  High unemployment and an economic contraction

One of the risk of a Fed policy that increases the supply of money is high inflation

• True
• False

Housing starts are a way to measure the health of the economy, a leading economic indicator

• True
• False