Question : 1) If the actual unemployment rate equal to the NAIRU, : 1384489

1) If the actual unemployment rate is equal to the NAIRU, then

A) actual GDP will be higher than potential GDP.

B) actual GDP will be below potential GDP.

C) potential GDP will expand permanently.

D) the unemployment rate is 0%.

E) actual and potential GDP are equal.

2) When aggregate output is less than potential output, the unemployment rate ________ the NAIRU.

A) falls toward

B) falls below

C) rises toward but never exceeds

D) is equal to

E) rises above

3) When aggregate output is greater than potential output, the unemployment rate ________ the NAIRU.

A) falls toward

B) falls below

C) rises toward but never exceeds

D) is equal to

E) rises above

4) When the growth rate of the labour force is greater than the growth rate of total employment, the unemployment rate

A) decreases.

B) increases.

C) is below NAIRU.

D) is above NAIRU.

E) is equal to NAIRU.

5) When the growth rate of the labour force is less than the growth rate of total employment, the unemployment rate

A) decreases.

B) increases.

C) is below NAIRU.

D) is above NAIRU.

E) is equal to NAIRU.

6) Suppose that next year 300 000 existing jobs in the economy are eliminated through layoffs and plant closures, and 400 000 new jobs are created through expansions and the creation of new firms. The amount of unemployment will rise over that year if

A) more than 300 000 people drop out of the labour force.

B) more than 100 000 people drop out of the labour force.

C) less than 100 000 people drop out of the labour force.

D) less than 100 000 people join the labour force.

E) more than 100 000 people join the labour force.

7) Suppose that next year 300 000 existing jobs in the economy are eliminated and 200 000 new jobs are created. The amount of unemployment will decline over that year if

A) more than 100 000 people drop out of the labour force.

B) less than 100 000 people drop out of the labour force.

C) less than 100 000 people join the labour force.

D) more than 100 000 people join the labour force.

E) more than 300 000 people join the labour force.

8) If there are more job vacancies in the economy than there are unemployed workers, it is likely that

A) fiscal policy aimed at increasing aggregate demand would cause the actual unemployment rate to move toward the NAIRU.

B) the actual unemployment rate is less than the NAIRU.

C) the economy has a high NAIRU.

D) there is excessive involuntary unemployment in this economy.

E) there is no structural unemployment in this economy.

9) If the actual unemployment rate is one percentage point less than the NAIRU, then

A) actual and potential GDP are equal.

B) actual GDP is greater than potential GDP.

C) actual GDP is less than potential GDP.

D) potential GDP will expand permanently.

E) potential GDP will contract until it equals actual GDP.

10) The total amount of unemployment in the economy rises when the flows of individuals

A) into unemployment are positive.

B) into unemployment exceed the flows out of unemployment.

C) out of unemployment exceed the flows into unemployment.

D) out of unemployment are negative.

E) out of unemployment are equal to the flows into unemployment.