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1. | A period during which real GDP declines for two quarters in a row, or six consecutive months, is call a(n) ___________. It begins when the economy reaches a peak, and ends when the economy reaches a trough.
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| A) recession
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| B) expansion
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| C) stagnation
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| D) depression
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2. | Changes in ____________ expenditures are one cause of business cycles.
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| A) political
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| B) healthcare
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| C) education
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| D) capital
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3. | Because there are always some workers who are in the process of changing jobs, there will always be some ____________ employment in the economy.
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| A) technological
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| B) structural
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| C) cyclical
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| D) frictional
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4. | Unemployment that occurs when a fundamental change in the operations of the economy reduces the demand for workers and their skills is called ___________ unemployment.
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| A) technological
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| B) structural
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| C) cyclical
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| D) seasonal
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5. | To measure the price level, economists select a market basket of goods and then construct a price index such as the ______________.
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| A) producer supply index, consumer supply index, or real GDP
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| B) consumer price index, producer price index, or implicit GDP
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| C) unemployment rate, inflation rate, or implicit GDP
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| D) producer price index, unemployment rate, or real GDP
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6. | Prices tend to _______ during expansions and then ________ during recessions.
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| A) rise faster, slow down
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| B) decrease, increase
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| C) rise proportionally, decrease
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| D) decrease exponentially, increase
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7. | The ________ curve is a curve that shows how much the actual distribution of income varies from an equal distribution.
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| A) Keynes
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| B) Lorenz
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| C) Reno
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| D) Yellen
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8. | One reason for the continued high poverty numbers is the __________.
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| A) prevalent lack of education
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| B) high unemployment rate
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| C) growing gap in the distribution of income
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| D) decreasing gap in the distribution of income
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9. | A program that requires welfare recipients to provide labor in exchange for benefits is called ___________.
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| A) labor-fare
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| B) welfare
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| C) workfare
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| D) labor-benefits exchange
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