Chapter 7, Economic Growth, Business Cycles, Unemployment, and Inflation Video Solutions, Macroeconomics

00:49

Problem 1

What are two ways in which long-term economic growth is measured? LO1

Kaylee Mcclellan

Numerade Educator

Problem 2

How does the U.S. per capita growth rate since 1950 compare to growth rates in other areas around the world? $\mathrm{LO} 2$

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01:25

Problem 3

What is the difference between real output and potential output? LO2

Ajay Singhal

Numerade Educator

02:33

The Bureau of Labor Statistics reported that in April 2009 the total labor force was $154,731,000$ of a possible $235,272,000$ working-age adults. The total number of unemployed was $13,724,000$. From this information, calculate the following:
a. Labor force participation rate.
b. Unemployment rate.
c. Employment-population ratio. $\mathrm{LO} 2$

Brooke Bussoletti

Numerade Educator

02:09

Problem 5

Draw a representative business cycle, and label each of the four phases. LO3

Vivek Singh

Numerade Educator

Problem 6

The index of leading indicators has predicted all past recessions. Nonetheless it's not especially useful for predicting recessions. Explain. LO3

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Problem 7

Distinguish between structural unemployment and cyclical unemployment. LO4

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03:20

Problem 8

What type of unemployment is best studied within the long-run framework? LO4

Kaylee Mcclellan

Numerade Educator

03:20

Problem 9

What type of unemployment is best studied under the short-run framework? LO4

Kaylee Mcclellan

Numerade Educator

00:44

Problem 10

Does the unemployment rate underestimate or overestimate the unemployment problem? Explain. LO4

Alejandro Ruiz

Numerade Educator

01:47

Problem 11

If unemployment rises by 2 percentage points, what will likely happen to output in the United States? (Use Okun's rule of thumb.) LO5

Kaylee Mcclellan

Numerade Educator

01:24

Problem 12

If nominal output is $$\$ 250$$ and the price index is 150 , what is real output? LO6

Dakota Averett

Numerade Educator

04:54

Problem 13

If nominal output rose 15 percent and the price index rose 2 percent, how much did real output increase? LO6

Majid Borumand

Numerade Educator

02:45

Problem 14

Answer the following questions about real output, nominal output, and inflation:
a. The price level of a basket of goods in 2008 was $$\$ 64$$. The price level of that same basket of goods in 2009 was $$\$ 68$$. If 2008 is the base year, what was the price index in 2009?
b. If nominal output is $$\$ 300$$ billion and the price index is 115 , what is real output?
c. Inflation is 5 percent; real output rises 2 percent. What would you expect to happen to nominal output?
d. Real output rose 3 percent and nominal output rose 7 percent. What happened to inflation? LO6

Jennifer Stoner

Numerade Educator

Problem 15

If nominal output rises from $$\$ 13.5$$ billion to $$\$ 14$$ billion and the GDP deflator rises from 100 to 105 ,
a. What is the percentage increase in nominal output?
b. What is the percentage increase in the price index?
c. What has happened to real output?
d. By how much would the price index have had to rise for real income to remain constant? LO6

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01:12