Chapter One: Chapter Quiz -- Overview of the U.S. Economy

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  1. The U.S. inflation rate in 2005 was approximately 
      2. -0.4% 
      2.2% 
      3.4% 
      6.1% 
      14.7% 

  2. The U.S. unemployment rate during 2005 averaged about
      3. 0.3% 
      1.6%
      5.0%
      7.2%
      9.2% 

  3. When the U.S. economy is "fully employed," many economists claim that the unemployment rate should be in the range of:
      4. 0%
      2.0% - 2.5%
      5.0% - 5.5%
      6.5% - 7.0%
      less than 10.0% 

  4. All else equal, if the Federal Reserve wants to reduce inflation, it should 
      5. raise interest rates
      lower interest rates
      raise taxes
      lower taxes
      raise interest rates and taxes 

  5. The 2005 fiscal-year U.S. budget deficit (ending Sept 30, 2005) was
      6. -$32 billion (or $32 billion surplus)
      $0 billion (a balanced budget)
      $319 billion
      $850 billion
      $3.9 trillion
      too large to count  

  6. The current level of the national debt is closest to
      7. $400 billion
      $1.8 trillion
      $8.4 trillion
      $24 trillion
      $391 trillion 

  7. As a general rule, when inflation rises, unemployment tends to
      8. rise
      fall
      stay constant
      double
      None of the above

  8. The U.S. economy began its last recession in March of
      9. 1991
      1999
      2000
      2001
      2002

  9. The U.S. economy is currently in recession.
      10. True
      False
      Uncertain

  10. It is very likely that the U.S. government will be bankrupt in a few years because of the growing national debt.
      11. True
      False
 
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