ECON 104 FINAL GOFFE EXAM ACTUAL

ECON 104 FINAL – GOFFE EXAM ACTUAL /

QUESTIONS AND VERIFIED ANSWERS

inflation rate - ---Answers---the percentage increase in the price level from one year to the next

labor force - ---Answers---the sum of employed and unemployed workers in the economy

labor force participation rate - ---Answers---the percentage of the working-age population in the labor force

menu costs - ---Answers---the costs to firms of changing prices

natural rate of unemployment - ---Answers---the normal rate of unemployment consisting of frictional unemployment and structural employment

Nominal Interest Rate - ---Answers---the stated interest rate on a loan

Producer Price Index (PPI) - ---Answers---an average of the prices received by producers of goods and services at all stages of the production process

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Structural unemployment - ---Answers---Unemployment that arises from a persistent mismatch between the skills to attributes of workers and the requirement of jobs

Unemployed - ---Answers---in the government statistics, someone who is not currently at work but who is available for work and who has actively looked for work during the previous month

Unemployment rate - ---Answers---the percentage of the labor force that is unemployed

United States growth rate - ---Answers---2%

Unemployment rate Calculation - ---Answers---(number of unemployed/labor force)*100

labor force participation rate calculation - ---Answers--- (labor force/working age population)*100

Underemployment - ---Answers---are working part time but wish to be working full time

marginally attached workers - ---Answers---those who've looked for a job in the past 12 months

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underemployment rate (U-6) - ---Answers---much higher than unemployment rate, about a 7.5% difference in the height of the most recent recession

Unemployed more than 27 weeks - ---Answers---highest its been was right after the great recession and is lower now at about 30%

Okun's Law - ---Answers---Δ%Y=3-2ΔU y is real GDP and U is unemployment rate

Causes of recessions - ---Answers---1. Monetary policy

• Oil Shock
• Fiscal policy
• Financial policy

Monetary policy and recessions - ---Answers---federal reserve's dual mandate which focuses on max employment, stable prices, and moderate long term interest rates

Oil Shock - ---Answers---

Fiscal policy and recessions - ---Answers---federal spending and taxes

Financial policy and recessions - ---Answers---

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