Economic Indicators and the Business Cycle

What is happening to the economy in a period of economic contraction?

• GDP is rising and unemployment is falling.
• GDP is rising and unemployment is rising.
• GDP is falling and unemployment is rising.
• GDP is falling and unemployment is falling.

Caleb takes a job selling cars.  In six months he is laid off due to a slowing economy and poor car sales.  What type of unemployment is Caleb experiencing?

• frictional
• structural
• seasonal
• cyclical

If you live on a fixed income, how will you be affected by inflation.

• You are hurt because your purchasing power has decreased.
• You are helped because your purchasing power has increased.
• You are helped because interest rates rise.
• You are hurt because interest rates rise.

The "market basket" that is a list of the prices of items purchased by an average consumer is known as the

• unemployment rate
• consumer price index
• producer price index
• economic growth rate

Who would benefit from inflation?

• Michael, a banker who has extended many fixed rate loans.
• Trenton, who has a fixed, contracted salary with no COLA.
• Emily, who took out a loan at a low fixed-interest rate.
• Kennedy, a businessman whose costs are rising.

Inflation is measured by the:

• GDP
• Unemployment rate
• CPI
• GNP

This is when a person becomes unemployed because they do not have the skills they need to find a job:

• frictional
• seasonal
• structural
• cyclical

GDP is the total value of goods and services

• produced all over the world
• produced in one month
• produced within a nation's borders
• produced by a singl company

The components of GDP include all of the following EXCEPT:

• consumption
• investment
• government spending
• bank transfers

This is unemployment because people are between jobs or who are looking for their first job:

• frictional
• structural
• seasonal
• cyclical