Review Questions and Exercises

Exercise 1

Name: Thricia B. Salvador Course and Year: BSED-III Soc.Stud

Examine each statement below and identify what type of unemployment is being exposed. Write your
answer on a separate sheet of paper.

1. Actor Coco just finished his last movie and is looking for his next film.
2. Zach and his two brothers were laid off from their construction jobs because of the recession.
3. Margarett just graduated from college and is searching for her first job.
4. Rose just quit his oil-exploring job with a U.S. company in Saudi Arabia and is searching for work in
Japan.
5. Ann has been laid off from her teaching job because of education cutbacks.
6. Austin is retiring voluntarily from the Marines and is looking for work in Los Angeles.
7. John lost his job as a court reporter when the county decided to use audio recorders in court.
8. Hunter has been laid off by IBM as part of the company's cost-cutting move.
9. Joy, a homemaker of 20 years, is out looking for her first paid job.
10. Michael has quit his job to stay home and raise his first child.

1. Frictional unemployment

2. Demand deficient unemployment

3. Structural unemployment

4. Frictional unemployment

5. Demand deficient unemployment

6. Voluntary unemployment

7. Structural unemployment

8. Frictional unemployment

9. Voluntary unemployment

10. Voluntary unemployment

Exercise 2

In a short bond paper, create a collage that represents the different types of unemployment.
 Review Question
Exercise 1
What fiscal long-term plan would you suggest in this time of crisis? Discuss and explain comprehensively

Many governments’ economic policy responses have been rapid and extensive. The fiscal packages so far have
aimed at cushioning the immediate impact of the sudden drop in economic activity on firms and households, and
to preserve countries’ productive capacity. While there are large variations in the size of fiscal packages, most are
significant, and some countries have taken unprecedented action. Getting the support to where it is most urgently
needed, including to small and medium-sized enterprises, nevertheless poses significant administrative challenges.

Maintaining business cash-flow has been a core goal of the fiscal policy measures that have been introduced,
supported by monetary and financial policies. Measures have included extending deadlines for tax filing, the
deferral of tax payments, the provision of faster tax refunds, more generous loss offset provisions, and some tax
exemptions, including from social security contributions, payroll taxes or property taxes.

Countries have also implemented wide-ranging measures to help businesses retain their workers through short-
time work schemes or wage subsidies. There is evidence, from policies implemented in the wake of the global
financial crisis, that keeping people in work through such schemes is an effective way of providing income support
and limiting job losses, while avoiding costly search and matching processes as recovery progresses.

Income support to households has been extended in many countries, generally through targeted cash benefits
rather than through tax cuts, given the need to deliver support quickly. There are also instances where access to
sick-leave benefits has been eased and eligibility expanded, with several countries broadening the coverage of
unemployment benefits to self-employed workers in particular.
 SUMMATIVE TEST

Test I. Multiple Choice

Directions: Read and understand the following questions carefully. Choose the letter of the correct
answer.

1. Which among the following types of unemployment refers to the workers who are in between jobs?

a. Demand deficient b. Frictional c. Structural d. Voluntary

2. Which among the following terminologies refer to individuals who are employable and seeking a job but
are unable to find a job?

a. Unemployment b. Underemployment c. Deployment d. Employment

3. The impact of unemployment can be felt by both the workers and the national economy and can create a
ripple effect. The preceding statement is?

a. Opinion b. Unreliable c. Correct d. Hearsay

4. Which of the following happens when a worker decides to leave a job because it is no longer financially
fulfilling?

a. Demand deficient b. Frictional c. Structural d. Voluntary

5. It happens when the skills set of a worker does not match the skills demands of the jobs available or if
the worker cannot reach the geographical location of a job.

a. Demand deficient b. Frictional c. Structural d. Voluntary

6. What is the biggest cause of unemployment that happens especially during a recession?

a. Demand deficient b. Frictional c. Structural d. Voluntary

7. Which of the following is a state of rising prices?

a. Inflation b. Deflation c. Anti-inflationary d. Disinflation

8. During inflation, usually people experience rise in incomes. This statement is?

a. Opinion b. Unreliable c. Correct d. Hearsay

9. This type of inflation is caused by the printing of currency notes.

a. Demand-pull b. Deficit-induced c. Credit d. Currency

10. If the consumption spending is countered by the government via price control and rationing device, the
inflationary situation may be called a suppressed one. This statement is?

a. Opinion b. Unreliable c. Correct d. Hearsay

11. The human input in the production is knows as?

a. Wage b. Capital c. Labor d. Enterprise

12. Which of the following tries to explain how and why different goods are valued differently?
a. Fiscal Policy c. Macroeconomics

b. Keynesian Approach d. Microeconomics

13. Macroeconomics deals with the following except one.

a. Price Levels c. Monetary Policy

b. Unemployment rates d. Foreign Trade

14. Which of the following believes that markets often don’t work well at allocating resources on their own
and favors fiscal policy by an activist government in order to manage irrational market swings and
recessions?

a. Business cycles c. Keynesian Approach

b. Game theory d. Monetarist

15. It views that free market as the best way to allocate resources and argue that stable monetary policy is
the best course for managing the economy.

a. Business cycles c. Keynesian Approach

b. Game theory d. Monetarist

16. Which of the following is not considered as fixed capital?

a. Factories c. New technologies

b. Railway tracks d. Machinery

17. It takes a top-down approach and looks at the economy as a whole, trying to determine its course and
nature.

a. Fiscal Policy c. Macroeconomics

b. Keynesian Approach d. Microeconomics

18. Which of the following are the two important variants of Cost-push inflation?

a. Cost-push and Profit-push c. Cost-push and Price-push

b. Profit-push and Wage-push d. Wage-push and Cost-push

19. Which of the following originates in the monetary sector?

a. Demand-pull inflation c. Wage-pull inflation

b. Profit-pull inflation d. Cost-pull inflation Macroeconomics

20. An increase in aggregate demand over the available output leads to a rise in the price level. Such
inflation is called?

a. Demand-pull inflation c. Wage-pull inflation

b. Profit-pull inflation d. Cost-pull inflation

Test I. Multiple Choice

1. B
2. A
3. C
4. D
5. C
6. A
7. A
8. C
9. A
10. C
11. C
12. D
13. A
14. C
15. D
16. B
17. C
18. C
19. D
20. A
 True

Test II. Modified True or False

Directions: If the statement is correct, write TRUE. If it is false, replace the underlined word(s) with the
word(s) that will make the statement true. (2 points each item)

1. According to the fiscal theory of the price level, it is not the non-interest bearing money but the total
True nominal liabilities including interest bearing notes and future fiscal surpluses that matter for price-level
determination.

True 2. For the BSP to successfully focus on price instability, there must be a credible commitment on the part
Ineffective of the National Government to reduce total fiscal deficits by a meaningful amount.
and
unsuitable
3. Errors in CPI measurement could lead to effective and suitable monetary policy response by the BSP
which definitely result to detrimental effects to the economy.

True 4. Liquidity trap happens when inflation rate declines too much leading to a threat of deflation.

True 5. Exchange rates play a significant role in monetary transmission mechanism and at the same time, it can
have a large impact on inflation rates.

6. The Philippines’ deflation target is measured trough the Consumer Price Index.
Inflation
target
True 7. Under an aggregate targeting framework, the BSP fixes money growth so as to maximize expected
inflation.

8. To increase the volume of credit in the financial system, the Bangko Sentral ng Pilipinas extends loans,
discounts, and advances to banking institutions.
Fixed terms
deposits
True 9. Special Deposits Account consists unfixed term deposits by banks and institutions affiliated with the
BSP.

10. Foreign Exchange Swaps refers to the actual exchange of two currencies at a specific date at a rate
True
agreed upon the deal date and the reverse exchange of the currencies at a farther date in the future.

True 11. Open Market Operations consist of repurchase and reverse repurchase transactions, outright transactions,
and foreign exchange swaps.

12. Monetary Policy is being used by the government to be able to control inflation and stabilize currency.
True

13. Money Supply Indicators are often found to contain unnecessary information for predicting future
behavior of prices and assessing economic activity.

14. Rediscounting is a standing credit facility provided by the BSP to help banks meet temporary liquidity
True needs by refinancing the loans they extend to their clients.

Necessary
15. Monetary Aggregate Targeting Approach is based on the assumption that there is a stable and
information
predictable relationship between money, output and inflation.
Test III. Essay

Directions. Expound your thoughts on the following matters. 10 points each.

1. Money is essential and it's what keeps the world going.

Answer:
Money is essential and its keeps the world going, because money provides options for you to live a
better life that you choose and puts you in control. Money is the most important function is as a medium of
exchange to facilitate transactions. It is used as the source to fulfill basic needs as well as source of comfort
life. Money is the most important source to live a healthy and prosperous life however cannot be compared
by the importance of love and care.

2. When is the best time for a person to start looking for a job?

Answer:
The best time for a person to start looking for a job is when he/she is ready to work. Many people is
looking for a job to earn money and the best time to look for a job is after graduating and passing the board
exam So while still young you can have a work. You can apply what you have learned in school to your
work to become flexible. To start your new job search is one to three months in advance of your preferred
employment start date. Two months is likely the best time to look for a job for the majority of
professionals. One month may make you feel rushed, while three months could limit your prospects.