FDNECON 01 · Macroeconomic Goals, Employment and Prices
Conventions
Original source-based practice for FDNECON Quiz #2. Questions are independent: use only each item’s complete givens. Amounts and units are stated in every numerical case. Numeric written answers omit currency symbols and units; rates are entered as numerical percentages (5 means 5%). Round only the final result to two decimals unless instructed otherwise. The course money-market diagram treats supply as vertical and policy-determined, with downward-sloping demand and other determinants fixed. Numerical money-demand equations, finite/infinite spending chains, gap percentages and multiplier/tax formulas are fully stated hypothetical practice extensions, not claims about measured Philippine outcomes or guaranteed policy effects. Expenditure and income approaches remain separate; foreign-income boundary inconsistencies in the source are explained in the reviewer. No question requires an unprovided graphic or another item’s answer.
Questions
01Which statement best expresses price stability?
- Every individual price falls each month.
- The general price level changes slowly and predictably; individual prices can still differ.
- The CPI is permanently fixed at 100 by law.
- All shops charge exactly the same price.
02What is the unemployment rate?
Problem
In a hypothetical working-age population of 9,000, 5,400 people are employed, 600 are without work, available and actively searching, and 3,000 are outside the labor force.
- 11.11%
- 60%
- 10%
- 8%
03What is the labor-force participation rate?
Problem
A stated working-age population contains 5,400 employed, 600 unemployed and 3,000 outside the labor force; total population in this group is 9,000.
- 66.67%
- 60%
- 90%
- 6.67%
04Which conclusion follows from the new figures?
Problem
Initially, employed = 5,400, unemployed = 600 and outside labor force = 3,000. Then 100 unemployed people leave the labor force. Employment and total stated working-age population remain unchanged.
- Employment rose by 100.
- The unemployment rate fell to 8.47%, but no new job is shown.
- The unemployment rate stayed at 10% because employment stayed fixed.
- The new unemployment rate is 5.56% because the population is unchanged.
05True or false: a fall in inflation from 6% to 2% necessarily means the overall price level fell.
- True
- False
06What is the real GDP growth rate?
Problem
Real GDP was ₱1,800 billion last year and ₱1,890 billion this year. Use consistent real annual measures.
- 50%
- 105%
- 5%
- 4.76%
07Which CPI and base-to-current price change are correct?
Problem
A fixed basket contains five meals and two notebooks. Base prices are ₱40 per meal and ₱100 per notebook. Current prices are ₱48 and ₱120 respectively.
- CPI 20; 120% increase
- CPI 100; the quantities are fixed
- CPI 120; 20% increase
- CPI 120; latest-year inflation must be 20%
08What is the inflation rate?
Problem
The consumer price index rises from 120 last year to 126 this year. State inflation as a percentage.
- 26%
- 6%
- 4.76%
- 5%
09Which mechanism best explains the unemployment?
Problem
A new production technology permanently removes manual roles. Open positions require certifications the displaced workers do not yet have.
- Cyclical
- Seasonal
- Structural
- Frictional
10Which change most directly indicates cyclical unemployment?
- A recession reduces orders, so firms lay off otherwise qualified workers.
- A holiday selling contract ends as usual.
- A graduate searches between school and a first job.
- A production method permanently makes a skill obsolete.
11True or false: the natural-rate concept in this lecture allows positive unemployment even when cyclical unemployment is absent.
- True
- False
12Which classification is supported?
Problem
Person A is a full-time student with no job, unavailable for work and not seeking one. Person B has a job and is temporarily on approved leave.
- Both A and B are unemployed.
- A is outside the labor force; B remains employed.
- A is employed; B is outside the labor force.
- Both are outside the labor force.
13What happens to the general price level in the second period?
Problem
CPI begins at 120, rises by 5% in period 1, and then has 3% inflation in period 2.
- It rises 3%.
- It stays unchanged.
- It returns to 100.
- It falls 2%.
14Which is the most defensible reading of the lecture’s development scatterplots?
- An average proves every resident has the same standard of living.
- GDP is the only possible cause of life expectancy.
- Higher GDP per person is generally associated with better outcomes, but the chart alone does not isolate causation.
- Every country with a higher GDP must have higher literacy than every poorer country.
15Under the lecture’s stylized Phillips-curve relationship, which combination represents moving toward lower unemployment?
- Lower unemployment and guaranteed zero inflation.
- Lower unemployment and every individual price falling.
- Lower unemployment and a CPI that must equal 100.
- Lower unemployment and higher inflation.
16Which pair correctly names a phase and its following turning point?
- Contraction followed by a peak.
- Expansion followed by a trough.
- A trough followed immediately by another trough, by definition.
- Contraction followed by a trough.