Macro econ exam 3

• What is the term to describe a worker with these characteristics?

  • 16 years or older

  • Not institutionalized (not in prison or psych center)

  • A civilian (not in the military)

  • Looking for work (actively searching)

Together, the employed and the unemployed make up the _____ _____

The unemployment rate

•  labor force/adult population * 100

• nominal price * p0/pt

• M + V = P + T

• unemployed/(labor force) * 100

the average number of times a dollar is spent on finished goods and services in a year (how fast money goes to one person to the next in economic way)

 the total volume of money held by the public at a particular point in time (could include physical cash in circulation). Can also include other relatively liquid assets

 When people mistake changes in nominal prices for changes in real prices, they fall prey to the

If the money supply is growing, velocity is constant, and there are no additional goods, then prices must go

• up

• down

• stay the same

shows the positive relationship between the inflation rate and real growth during the period when prices and wages are sticky (upward sloping)

• long-run aggregate supply curve

• inflation curve

• short-run aggregate supply curve

• aggregate demand curve

the costs of changing prices

 the allocation of consumption, work, leisure across time to maximize your total well-being

• Intertemporal substitution

• uncertainty and irreversible investments

• labor adjustment costs

• time bunching and network effects