AP Macroeconomics Practice Test: Inflation and Unemployment

Test Information

Question 15 questions

Time 18 minutes

See All test questions

1. The CPI is calculated for each by

2. If the CPI goes to 150 from 120, then prices have

3. According to experts, the CPI

4. When products improve in quality the CPI will

5. The GDP Deflator

I. is used to calculate inflation rates.

II. is an alternative to the CPI.

III. is more accurate than the CPI.

6. If nominal GDP equals $5,000 and real GDP equals $4,000, then the GDP Deflator equals

7. If nominal GDP equals $6,000 and the GDP deflator equals 200, then real GDP equals

8. Which of the following is NOT a major cost of inflation?

9. The term "menu costs" refers to

10. Inflation

11. Rising prices are a problem because

12. Fisher's Hypothesis states that

13. Sue loses her job at a shoe factory when the economy falls into a recession. Sue is

14. There is a strong demand for welders in California but Bill, an unemployed welder, lives in New York. Bill is

15. It is unlikely that the unemployment rate will ever fall to zero because of