ECON 200 UOFA EXAM 3 ACTUAL QUESTIONS AND CORRECT ANSWERS COMPLETE STUDY GUIDE

ECON 200 UOFA EXAM 3 ACTUAL
QUESTIONS AND CORRECT ANSWERS
COMPLETE STUDY GUIDE

●● Structural.
Answer: caused by changed in the industrial make-up of the economy;
linked with technology.


●● Frictional.
Answer: caused by the delay in matching available jobs & workers.


●● Cyclical.
Answer: caused by an economic downturn; no jobs available


●● Labor force equation.
Answer: employed + unemployed


●● Unemployment rate:.
Answer: (unemployed/labor force) x 100


●● full employment.
Answer: If there is no cyclical unemployment, than ____ is taking place

,●● Recession.
Answer: If cyclical unemployment is > 0


●● Economic boom.
Answer: actual unemployment rate is less than the natural rate. This
happens temporarily when the economy is expanding beyond its long-
run capabilities


●● Labor force participation rate.
Answer: (labor force/working age population) x 100


●● Inflation.
Answer: General rise in the average price level


●● Consumer Price Index.
Answer: measurement of the price level based on the consumption
patterns of a typical consumer.


●● cost of inflation.
Answer: Uncertainity


●● cost of inflation.

, Answer: Signal extraction problem: is an increase in price a result of an
increase in demand or
inflation?


●● cost of inflation.
Answer: Menu costs: costs of changing prices


●● cost of inflation.
Answer: Money illusion: Austin Powers clip


●● Cost push.
Answer: supply side


●● Demand pull.
Answer: demand side


●● Long-run economic growth.
Answer: is the key to raising the average standard of living.


●● Long-run world per capita GDP.
Answer: looks like a hockey stick; flat to the late 18th century, then
sharp rise.