Political business cycles consist of fluctuations caused by
A. misguided foreign policies designed to increase political pressure over our trade partners
B. economic policies designed to help win elections
C. the Fed trying to support every policy proposed by the president
D. our trade partners trying to react to changes in U.S. policies
E. the inability of politicians to agree on the right policy mix
Predictions based on the theory of political business cycles suggest that
A. presidents who succeed in reducing inflation sharply before an election have the best chance to be re-elected even if unemployment increases
B. achieving a low rate of unemployment before an election is less important than achieving a low rate of inflation
C. presidents who want to be re-elected should aim for low inflation early in their terms and then try to achieve strong economic growth before the next election
D. the practice of manipulating the economy before an election seldom pays off since voter behavior is not significantly affected by economic issues
E. none of the above
Which of these people could officially be counted as unemployed?
A. a garage attendant who got fired from his old job two months ago but will start a new job in two weeks
B. a busboy who works only four hours a day, five days a week, but would prefer to work full-time as a waiter
C. an accountant who quit her job when she had a baby two months ago
D. a woman who joined the babysitters' union several months ago and averages about five customers a week at her $10/hour rate
E. none of the above
Which of the following statements is TRUE for the United States?
A. the unemployment rate consistently tends to be slightly higher among males than among females
B. the unemployment rate of teenagers tends to be much higher and more variable than that of people 20 years and older
C. during the 1981/1982 recession, the unemployment rate among teenagers was nearly the same as the unemployment rate among workers over 20
D. the highest unemployment rate in the post World War II period occurred in the 1974/75 recession
E. the unemployment rate among minorities consistently remained above 10 percent over the last 5 decades
The Beveridge curve shows a relationship between
A. the frequency and the duration of unemployment
B. the level of output and the unemployment rate
C. job vacancies and the unemployment rate
D. job vacancies and the labor force participation rate
E. the unemployment rate and alcohol consumption
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