Chapter 13 Economics

Question 0

What is Frictional Unemployment?

Answer 0

Occurs when people take time to find a job.

Question 1

What are Four basic kinds of unemployment?

Answer 1

frictional, seasonal, structural, and cyclical.

Question 2

What is Seasonal Unemployment?

Answer 2

Occurs when industries slow or shut down for a season or make seasonal shifts in their production schedules.

Question 3

What is Structural Unemployment?

Answer 3

Occurs when workers’ skills do not match the jobs that are available.

Question 4

What are the five major causes of structural unemployment?

Answer 4

The development of new technology, The discovery of new resources, Changes in consumer demand, Globalization, Lack of education.

Question 5

What is Cyclical Unemployment?

Answer 5

Unemployment that rises during economic downturns and falls when the economy improves.

Question 6

What is Unemployment Rate?

Answer 6

The percentage of the nation’s labor force that is unemployed.

Question 7

What is Full Employment?

Answer 7

The level of employment reached when no cyclical unemployment exists.

Question 8

What is Underemployment?

Answer 8

Working at a job for which they are over-qualified, or working part-time when they desire full-time work.

Question 9

What is a Discouraged Worker?

Answer 9

A person who wants a job but has given up looking.

Question 10

What is Inflation?

Answer 10

A general increase in prices.

Question 11

What is Purchasing Power?

Answer 11

The ability to purchase goods and services.

Question 12

What is Price Index?

Answer 12

A measurement that shows how the average price of a standard group of goods changes over time.

Question 13

What is Consumer Price Index (CPI)?

Answer 13

A price index determined by measuring the price of a standard group of goods meant to represent the “market basket” of a typical urban consumer

Question 14

What is Market Basket?

Answer 14

A representative collection of goods and services.

Question 15

What is Inflation Rate?

Answer 15

The percentage rate of change in price level over time.

Question 16

What is Core Inflation Rate?

Answer 16

The rate of inflation excluding the effects of food and energy prices.

Question 17

What is Hyperinflation?

Answer 17

Inflation that is out of control.

Question 18

What is Quantity Theory?

Answer 18

Too much money in the economy causes inflation.

Question 19

What is Demand-Pull Theory?

Answer 19

Inflation occurs when demand for goods and services exceeds existing supplies.

Question 20

What is Cost-Push Theory?

Answer 20

Inflation occurs when producers raise prices in order to meet increased costs.

Question 21

What is Wage-Price Sprial?

Answer 21

The process by which rising wages cause higher prices, and higher prices cause higher wages.

Question 22

What are the 3 effects on inflation?

Answer 22

The value of money changes, Income may not match inflation, Interest rates may not keep up with the inflation rate.

Question 23

What is Fixed Income?

Answer 23

Income that does not increase even when prices go up.

Question 24

What is Deflation?

Answer 24

A sustained or drop in the price level.

Question 25

What is Poverty Threshold?

Answer 25

The income level below which income is insufficient to support a family or household.

Question 26

What is Poverty Rate?

Answer 26

The percentage of people who live in households with income below the official poverty threshold.

Question 27

What factors contribute to poverty?

Answer 27

Race and ethnic origin, Type of family, Age, Residence.

Question 28

What causes Poverty?

Answer 28

Lack of education, Location, Racial and Gender Discrimination, Economic Shifts, Shifts in Family Structure.

Question 29

What is Income Distribution?

Answer 29

How the nation’s total income is distributed among its population.

Question 30

What are Food Stamps?

Answer 30

Government-issued coupons that recipients exchange for food.

Question 31

What is Lorenz Curve?

Answer 31

Illustrates income distribution

Question 32

What are the 3 factors of the Income Gap?

Answer 32

Differences in skills and education, Inheritances, Field of work.

Question 33

What are Enterprise Zones?

Answer 33

Area where companies can locate free of certain state, local, and federal taxes and restrictions.

Question 34

What is a block grant?

Answer 34

Federal funds given to the states in lump sums.

Question 35

What is Workfare?

Answer 35

A program requiring work in exchange for temporary assistance.