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Chapter 7 [22]
Unemployment, Inflation, and
Long-Run Growth
Unemployment
1. How does the Bureau of Labor Statistics officially characterize an employed person?
It is anyone who is 16 years of age or older who is working for pay either for
someone else as an employee or in his or her own business for one or more hours
per week. It can also be someone who works without pay in a family run business
at least 15 hours per week, or who has a job but has been temporarily absent, with
or without pay.
Diff: 1 Skill: Definition Topic: employment
AACSB:
Figure 22.1
2. Using Figure 22.1 calculate the labor force participation rate in each of the years
between 1950 and 2009.
Diff: 1 Skill: Definition Topic: employment

AACSB:
171
Copyright © 2014 Pearson Education, Inc.
172 Case/Fair/Oster, Principles of Macroeconomics, 11th Edition
3. Using Figure 22.1 calcuulate the unemployment rate in each of the years between 1950
and 2009.
The unemployment rate is calculated by dividing the number of people

unemployed by the total labor force.
Diff: 2 Skill: Analytic Topic: official employment statistics
AACSB: Reflective Thinking
4. How might the official employment statistics of the BLS be a a misleading picture of
the overall health of the economy?
The official definition of an employed person is anyone who is 16 years of age or
older who is working for pay either for someone else as an employee or in his or
her own business for one or more hours per week. This means that you could
potentially have an economy with “high” levels of employment but many of these
people may be working part-time and not earning the income necessary for them
to maintain their standard of living.
Diff: 2 Skill: Definition Topic: official employment statistics
5. What is meant by the phrase "not in the labor force?" Give examples of why people
might be in this state.
It means people over the age of fifteen who are not looking for work, either
because they do not want a job or because they have given up looking. It might
include retirees, full-time students, stay-at-home parents, individuals in
institutions like prisons or mental hospitals or elderly parents.
Diff: 1 Skill: Fact Topic: labor force
AACSB:
6. Some countries use claims for unemployment compensation as the method for
calculating the unemployment rate. This of course is not the case in the United States.
Can you think of any reason why this method might not be an accurate portrayal of the
true unemployment rate?
Essentially this method may understate the true unemployment rate since many
people do not file for unemployment compensation.
Diff: 1 Skill: Conceptual Topic: unemployment
AACSB: Analytic Skills
7. Explain how it might be possible for the unemployment rate to drop inspite of a severe
recession.
When a recession becomes very severe and protracted many workers who may
have responded in the BLS survey that they were looking for work may become
discouraged and stop looking. If this happens they effectively drop out of the labor

Chapter 7 [22]: Unemployment, Inflation, and Long-Run Growth 173
force. The only way to be officially counted as unemployed is if you are actively
seeking employment. Therefore the unemployment rate drops.
8. What is the official definition of an unemployed person?

It is anyone who is without work aged 16 or older who is available for work and
has been actively seeking work in the last four weeks.
Diff: 1 Skill: Definition Topic: official unemployment
AACSB:
Table 7-1
9. Using Table 7.1 above, calculate the unemployment rate.

The total amount of people who are unemployed and looking for work are 400 +
200 + 100 = 700. The labor force equals this number plus the employed - 700 +
8000. The unemployment rate is equal to 700/8700 x 100% = 8.05%
Diff: 1 Skill: Analytic Topic: unemployment
Table 7.2
10. Using the Table 7.2 calculate the labor-force participation rate.
Labor-force participation rate = Labor force/Population = (45,000 + 5000)/70000 x
100% = 71.4%
Diff: 1 Skill: Analytic Topic: labor-force participation

11. Using Table 7.2 calculate the unemployment rate and show your work.
Unemployment rate = Unemployed / (Employed + Unemployed) = 5000/(45000 +
5000) x 100% = 10%
Diff: 1 Skill: Analytic Topic: unemployment rate
12. What might happen to the official unemployment rate if unemployment compensation
were eliminated? Explain your answer.
The official unemployment rate may actually fall if unemployment compensation
were eliminated. The reason is that unemployment compensation helps reduce the
opportunity cost involved in looking for work. Workers may spend a little more
time looking for work if they have some amount of income to rely on. However, if
the worker is receiving no compensation the opportunity cost of continuing to
search is very high and unemployed persons may decide to take job offers more
quickly.
Diff: 2 Skill: Conceptual Topic: unemployment rate
January February
Labor Force 140,000 142,000
Employed 130,000 131,000
Unemployed
Unemployment
Rate %
Table 7.3
13. Fill in the empty cells in the above table 7.3.
January February
Labor Force 140,000 142,000
Employed 130,000 131,000
Unemployed 10, 11,
00 00
0 0
Unemployment 7.1 7.7
Rate %


14. Explain how the unemployment rate can drop even if the total number of people with
and without jobs remains constant.
People can become discouraged about finding jobs and stop looking for work. If
they do they no longer count as part of the unemployed ranks nor are they part of
the labor force. Since the unemployment rate is the ratio of those not working but
actively seeking work divided by the labor force the unemployment rate can fall
even if the number of people with or without jobs remain constant.
Diff: 2 Skill: Definition Topic: unemployment rate
15. Suppose there are 10 million unemployed out of a labor force of 100 million. This
means an unemployment rate of 10/100 = .10, or 10 percent. Recalculate the
unemployment rate if 1 million of these 10 million unemployed workers stop looking
for work.
If 1 million of these 10 million unemployed people stopped looking for work and
dropped out of the labor force then 9 million would be unemployed out of a labor
force of 99 million. The unemployment rate would then drop to 9/99 = .091, or 9.1
percent.
AACSB:
16. Suppose there are 10 million unemployed out of a labor force of 100 million. This
means an unemployment rate of 10/100 = .10, or 10 percent. Recalcuate the
unemployment rate if 1 million previously discouraged workers re-enter the workforce
and start looking for work but don’t immediately find employment.
Now the labor force is 101 million workers and there are 11 million unemployed
workers. The unemployment rate is now 10.89%.
AACSB:
17. Explain how it might be possible for the unemployment rate to decline even though the
number of unemployed is growing.
This may be possible if the number of new entrants into the labor force is
increasing at a greater rate than the number of people who are becoming
unemployed. Since the unemployment rate is a ratio and the numerator is growing
more slowly than the denominator then the unemployment rate will fall.
AACSB:
18. Explain how and why the unemployment rate may actually rise during an economic
recovery.
When an economic recovery is under way many people who were previously
classified as “discourgaged workers” may enter the labor force looking for work.

However, as the ranks of these people enter the labor force it might be possible for
a time that many of these people may not find work right away. Since these people
were previously not technically unemployed there active job search now makes
them officially unemployed.
19. With a population of 100 million, a labor force of 90 million and the unemployed
measured at 9 million what is the rate of unemployment?
The unemployment rate is 9 million/(90 million) x 100% = 10%
AACSB:
20. Classify the following people as either employed, unemployed, discouraged worker or
not in the labor force:
1. A retired person
2. A full-time student who is not working
3. An individual who looked for work for six months and stopped looking five weeks ago
4. A law student who finishes law school, quits his job as a law clerk and has been actively
seeking work as a lawyer.
1. This person is not in the labor force out of personal choice.
2. This person is not in the labor force because he is devoting his time as a
student.
3. This person is not in the labor force because she or he is a discouraged
worker and would not qualify as unemployed because he is no longer looking for
work.
4. This person is classified as unemployed because he is actively seeking
employment.
Diff: 1 Skill: Conceptual Topic: labor force
AACSB:
21. Assume the number of people employed is 100,000 and the labor force is 500,000.
Calculate the unemployment rate based on this information.
The unemployment rate is equal to 400,000/500,000 x 100% = 80%.
AACSB:
22. In September there are 10,000 people unemployed and the labor force is 250,000. If the
only thing that changed between September and October is that 2500 people stop

looking for work what can we say is true about the unemployment rate in September
and the unemployment rate in October?
In September the unemployment rate is 4% and in October the unemployment
rate is 3.03%. This is true because the 2500 people who stop looking reduces both
the number of people unemployed and reduces the number of people in the labor
force.
23. Assume a population of 3,000,000 people, 500,000 people employed and 1,500,000 in
the labor force. Calculate the unemployment rate.
The number of unemployed persons = the labor force - employed. Therefore the
unemployment rate = 1,000,000/1,500,000 x 100% = 67%
24. Explain the major differences in the unemployment rate by demographic group.
Teenagers have higher unemployment rate than adults. African Americans have
roughly twice the unemployment rates as their white cohorts. In addition, there
are differences across industry.
Diff: 2 Skill: Fact Topic: unemployment rate
AACSB:
25. Explain why it might be a fruitless endeavor for the government to attempt to reduce
frictional unemployment.
Since this is the portion of unemployment that is due to the normal working of the
labor market, efforts to reduce it may actually lead to other inefficiencies in the
labor market.
Diff: 1 Skill: Definition Topic: frictional unemployment
AACSB:
26. Explain what structural unemployment is and give some examples.

Structural unemployment arises when skills of workers become obsolete and
generally refers to longer-run adjustment problems that tend to last for years.
Examples might include a welder who is put out of work because of the
introduction of robotics on the assembly line or a receptionist who is displaced by
a modern voice mail system.
Diff: 1 Skill: Definition Topic: structural unemployment
AACSB:

27. Explain what is meant by the discouraged-worker effect?

It represents a decline in the measured unemployment rate that results when
people who want to work but cannot find work stop looking for jobs and then
drop out of the ranks of the unemployed and the labor force.
Diff: 1 Skill: Fact Topic: discouraged worker
AACSB:
28. What changes might take place to reduce the number of discouraged workers?
Increased confidence on the part of discouraged workers that employment
prospects may improve could reduce the number of discouraged workers.
Diff: 1 Skill: Conceptual Topic: discouraged workers
AACSB:
29. List and explain the three major types of unemployment.

Frictional unemployment - caused by short-run job mismatch and is often
voluntary. People are in search of better paying jobs. Structural unemployment -
this is caused by the skills of workers suddenly becoming obsolete because of
changes in technology or the structure of the economy. Cyclical unemployment -
caused by the recessionary phase of the business cycle.
Diff: 1 Skill: Fact Topic: types of unemployment
AACSB:
30. What is the natural rate of unemployment and the current consensus estimate of
economists?
The natural rate of unemployment is generally considered to be the sum of
frictional and structural unemployment and is estimated to be approximately 4-
6%.
Diff: 1 Skill: Fact Topic: natural rate of unemployment
AACSB:
31. What are the economic costs of unemployment?

Whenever resources are unemployed there is always some sort of waste. In the
case of unemployment it manifests itself in the potential production of goods and
services irretrievably lost. There are also other costs such as increased burdens to
taxpayers to fund unemployment compensation programs and the individual cost
in terms of a loss of self esteem and dignity.
Diff: 1 Skill: Conceptual Topic: costs of unemployment
AACSB:
32. Compare and contrast cyclical unemployment and natural unemployment

Cyclical unemployment is the increase in unemployment that occurs during
recessions and depressions because the unemployed exceed the number of job

vacancies. The natural rate of unemployment occurs as the normal functioning of

the economy. It is often taken as the sum of frictional unemployment and
structural unemployment.
Diff: 1 Skill: Conceptual Topic: cyclical and natural unemployment
AACSB:
33. Why might a certain amout of frictional unemployment improve the efficiency of labor
markets?
Many workers whose productivity has run ahead of their wages may begin to look
for better-paying jobs. This is not only a good thing for those workers but it also
means that they are likely to find work in parts of the economy where their skills
are more highly valued. It also means that their job search creates a vacancy
which can be filled by other job seekers. In the end it may create a greater match
of skills to the jobs available.
Diff: 1 Skill: Conceptual Topic: frictional unemployment
AACSB:
34. Why is unemployment bad for society? Why is it bad for the individual or household?
Unemployment is bad for society because it means that society does not get to
enjoy the goods and services that would have been provided by those people who
otherwise would have been working. It is bad for the individual or the household
because in the meantime the individual and the household experience either a
major reduction in income or no income at all. It can also be psychologically
distressing for the individual and may lead to a loss of self esteem and self worth.
It may even lead to mild or severe cases of depression for the individual if
unemployment persists.
AACSB:
35. Identify the following events as either increasing or decreasing the natural rate of
unemployment.
Event Effect on the natural rate

of unemployment
If the labor market
becomes more efficient
so that the unemployed
are more quickly
matched with jobs.
A permanent reduction
in the number of
middle management
positions due to
downsizing.

Event Effect on the natural rate

of unemployment
If the labor market Decrease
becomes more efficient
so that the unemployed
are more quickly
matched with jobs.
A permanent reduction Increase
in the number of
middle management
positions due to
downsizing.
Diff: 1 Skill: Definition Topic: natural rate of unemployment

AACSB:
36. Discuss what is meant by the discouraged-worker effect. Explain whether the existence
of the discouraged-worker effect causes the official unemployment rate to understate or
overstate the "true" level of unemployment.
Individuals who stop searching for work are classified as out of the labor force.
When these "discouraged" individuals stop searching, the size of the labor force
decreases and, for a given level of employment, the unemployment rate will fall.
The discouraged-worker effect, therefore, reduces the unemployment rate and
causes the official unemployment rate to understated the "true" level of
unemployment.
Difficulty: 2 Skill: Conceptual Topic: discouraged-worker effect
AACSB:
37. Explain the differences between the unemployment rate and the labor-force
participation rate.
The unemployment rate is the percentage of the labor force that is unemployed
where the labor force is equal to the number of employed individuals plus the
number of unemployed individuals. The labor-force participation rate is simply
the ratio of the labor force to the population (16 years old or over).
Difficulty: 2 Skill: Definition Topic: labor-force participation rate
AACSB:
38. You are an employee of the Bureau of Labor Statistics involved in the monthly survey
of households used to estimate the unemployment rate. In each of the following cases,

classify the individual as employed, unemployed, or not in the labor force. Explain your
classification.
(a) During the entire week containing the 12th of the month, Rosie the Riveter misses
work simply because she didn't feel like going in to work.
(b) Jenny Wren is a volunteer 20 hours a week on a Rape Crisis telephone hotline. She
feels she makes an important contribution to society and would not accept a paid job if
one were offered to her.
(c) Cauley McCulkin is a hugely successful film star, age 12, who has earned over
$5,000,000 each year for the past five years. Currently, Cauley is filming a new movie
on location in Tenerife.
(d) Maxwell Edison, a full-time Ph.D. student, is involved in ground-breaking research
in fiber optics. His dissertation advisor has already claimed that Maxwell's work will
revolutionize telecommunications.
(e) Maggie Madd, 84, works 10 hours a week doing cleaning services for her son,
Norman Neurotic. He pays her minimum wage.
(a) Rosie is employed. If Rosie is temporarily absent, with or without pay, she is
considered employed.
(b) Jenny is not in the labor force. She is not seeking a job nor does she meet the criteria
required to be classified as employed.
(c) Cauley is not in the labor force. He is less than 16 years old.
(d) Maxwell is not in the labor force. He is a full-time student.
(e) Maggie is paid and employed.
Difficulty: 2 Skill: Conceptual Topic: unemployment rate
39. During a press conference, the Secretary of Employment notes that the unemployment
rate is 7.0%. As a political opponent, how might you criticize this figure as an
underestimate? In rebuttal, how might the Secretary argue that the reported rate is an
overestimate of unemployment?
The unemployment rate given by the secretary might be considered an
underestimate because discouraged workers, who have given up the job search in
frustration, are not counted as unemployed. In addition, full-time workers may
have been forced to work part-time. In rebuttal, the secretary might note that a
portion of the unemployed have voluntarily left their jobs. Most workers are
unemployed only briefly and leave the ranks of the unemployed by gaining better
jobs than they had previously held.
Difficulty: 2 Skill: Analytic Topic: unemployment rate
40. You are an employee of the Bureau of Labor Statistics involved in the monthly survey
of households used to estimate the unemployment rate. In each of the following cases,

classify the individual as frictionally, structurally, or cyclically unemployed. Explain

your classification.
(a) There has been a general economic slow down. Because of weak demand, Andy
Capp has lost his portering job at the docks.
(b) Phil McCafferty, a newly qualified dental school graduate, is looking for a place to
set up practice.
(c) Coal miner Ned Ludd is thrown out of work by the introduction of a more
mechanized production process.
(d) Latosha Hogan, a computer programmer with a large bank, quit her job two months
ago in search of a better-paid programming position. She is still looking.
(a) Andy is cyclically unemployed. He has lost his job as a result of the general
economic recession.
(b) Phil is frictionally unemployed. Job openings exist for him. It is merely a case of
tracking down a position.
(c) Ned is structurally unemployed. Unemployment due to technological change in an
industry is classified as structural.
(d) Latosha is frictionally unemployed. Job openings exist for her.
41. How do the costs of unemployment differ in an economy with a large underground
sector relative to one with a small underground sector?
The costs will be less in an economy with a large underground sector and output
will be higher than officially recorded. Social costs such as low self-esteem, suicide,
divorce rates, and so on will also be lower.
Diff: 3 Skill: Analytic Topic: underground economy
AACSB:
42. For each of the following, indicate if the person would be classified as employed,
unemployed, or not in the labor force (a) a 70-year-old man who left his job to help
his daughter in her business for 10 hours a week, (b) a 20-year-old college student
who is out of school for the summer and is looking for a job, (c) a 30-year-old woman
with a Ph.D. in history who has not been able to find a teaching position and is driving a
cab 30 hours a week, and (d) a 40-year-old steel worker who isn't working and
has given up searching for a job.
These individuals would be classified (a) not in the labor force, (b) unemployed,
(c) employed, and (d) not in the labor force.
Diff: 2 Skill: Conceptual Topic: employment classification
AACSB:

43. If the national unemployment rate is 7%, does every region in the country have a 7%
unemployment rate? Explain.
No. Different regions of the country could have unemployment rates either above
or below 7%, depending on which sectors of the economy have been hardest hit by
unemployment.
AACSB:
44. Explain why some economists argue that counting discouraged workers as unemployed
gives a better picture of the unemployment situation. How would the magnitude of the
unemployment rate change if discouraged workers were counted as unemployed?
Some argue that discouraged workers should be included because they would take
jobs if a job became available. If discouraged workers were included, the
unemployment rate would increase.
Diff: 2 Skill: Analytic Topic: discouraged workers
45. Explain why some unemployment is inevitable. How can unemployment actually
benefit the economy?
Some unemployment is inevitable because people switch jobs or need to search for
a job after finishing school. The structure of the economy is always changing, so
some people will find that their skills have become outdated, and they no longer
can find employment. Unemployment may benefit the economy if it leads to a
better match between employee and employer.
46. Explain the three different types of unemployment. Give an example of each type.
Given what you have learned about the different types of unemployment, suggest three
policies that could be used to reduce unemployment, one for each type of
unemployment.
The three different types of unemployment are frictional, structural, and cyclical.
Frictional unemployment results from the normal workings of the labor market.
An example of frictional unemployment is an individual looking for his or her first
job after graduating from college. Structural unemployment is due to changes in
the economy. An example of structural unemployment is a steel worker in
Pittsburgh that lost his job because the steel plant he worked at shut down.
Cyclical unemployment is the unemployment that occurs during recessions and
depressions. An example of cyclical unemployment is a construction worker who
loses his job because the demand for new office buildings has fallen. A policy that
may reduce frictional unemployment is increasing the efficiency of the labor
market by having information networks that provide information on jobs all
across the country so the unemployed can more easily find jobs. Structural
unemployment may be reduced through job relocation assistance or job

retraining. Cyclical unemployment could be reduced through expansionary

monetary and fiscal policies.
Diff: 1 Skill: Definition Topic: types of unemployment
AACSB:
47. Explain the costs of unemployment. Be sure to include both the economic and
noneconomic costs.
The costs of unemployment include the value of the output lost in the current time
period and the value of the output lost in the future because unemployment leads
to less investment. Unemployment also has social costs, including increases in the
crime rate, the divorce rate, and the suicide rate.
Diff: 1 Skill: Conceptual Topic: costs of unemployment
AACSB:
Inflation
48. Suppose state employees complain bitterly that they are not receiving substantial
enough raises. In addition, lawmakers respond by saying they have nothing to complain
about since they have been receiving 8% pay raises the past three years. What could
account for the apparent disagreement?
The state employees are probably upset that their pay increases are only nominal
increases. That is they may not be sufficient to cover the cost of inflation. Perhaps
inflation is rising at a faster clip than their pay increases. This results in a decline
in real income across time.
Diff: 2 Skill: Analytic Topic: inflation
49. Critically evaluate the following statement. “As consumers increase their demand for
hybrid vehicles in response to high gasoline prices this is leading to higher prices for
these sames cars. This inevitably would lead to inflation.”
This statement is false. The increase in the price of hybrid cars is only a relative
price increase but does not necessarily mean that it will lead to an increase in the
overall price level. Inflation is primarily a monetary phenomenon. It is not part of
the normal operations of a free market.
Diff: 2 Skill: Analytic Topic: inflation
AACSB:
50. "If inflation is fully anticipated by all parties, the redistributional effects would be
minimal. It's the fact that inflation surprises us that causes there to be winners and
losers." Comment. Which costs still occur even with fully anticipated inflation?
It is true that unanticipated inflation can cause income redistribution. Individuals
on fixed incomes may suffer greatly, for example, whereas workers in powerful
unions may thrive. However, some costs are borne by society in general, even

when inflation is fully anticipated. Administrative costs, hoarding of real goods,

additional search costs, and so on reduce the welfare of society in general.
Dificulty: 2 Skill: Analytic Topic: anticipated inflation
51. Define inflation.

Inflation is an increase in the average price level in the economy across time.
Diff: 1 Skill: Definition Topic: inflation
AACSB:
52. What is the CPI or consumer price index?

It is an index computed each month by the Bureau of Labor Statistics using a
bundle that is meant to represent the "market basket" purchased monthly by the
typical urban consumer. It is the ratio of the cost of that basket in any particular
year to its cost in an arbitrarily chosen base year.
Diff: 1 Skill: Definition Topic: consumer price index
AACSB:
53. If gasoline prices rise and the CPI goes up as a consequence why might there be reason
to believe that the true cost of living has not risen by the full amount of the increase in
gasoline prices?
The reason is that the CPI assumes a fixed market basket of goods. However, the
truth is that in the face of higher gasoline prices many people will no doubt
economize on their use of gasoline and this fact will blunt the overall amount of
spending increase.
Diff: 1 Skill: Conceptual Topic: consumer price index
54. The CPI does not include investment items, such as stocks, bonds, real estate, and life
insurance? What reason would the BLS have for not counting these items?
These items relate to savings and not to day-to-day consumption expenses.
Diff: 1 Skill: Conceptual Topic: consumer price index
AACSB:
55. What is the PPI or producer price index?

It measures prices that producers receive for products at all stages in the
production process.
Diff: 1 Skill: Definition Topic: producer price index
AACSB:

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A swing, so durable that it has become a virtual landmark, was
made from a long, straight hickory sapling suspended from the limb
of a tree. The sapling was split part of its length, as shown in the
illustration, and a bolt put through it to prevent the upper portion from
cracking. The lower end was smoothed off, so as not to injure the
hands, and mortised through a slab of wood, as shown in the
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Match Safe of Miniature Cannon Shell
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Bench Support for a Miter Box
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A Blowpipe for Gas
Blowpipe Connection to the Ordinary Illuminating-Gas Main for Hard and

Soft Soldering
Every experimenter who has a gas connection within convenient

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to a hard-rubber, or amber, mouthpiece. By regulating the gas supply
and blowing to the proper degree, a pencil of blue flame may be
produced, anywhere from 1 to 4 in. long. For heating large surfaces,
the nozzle tip should be removed.
This method of soldering not only makes a better connection than
the usual copper, but is instantly available and does not disarrange
the several pieces where, as is often the case, it is not practicable to
pin or hold them in place.
Scraper for Dishes
A Dish Scraper Made of a Piece of Rubber Inserted in a Wood Handle
Housekeepers will find the scraper shown to be silent and more

rapid than a knife for cleaning dishes. It consists of a handle cut from
a piece of straight-grained wood, with a kerf sawed in the wide end
to a depth of ³⁄₄ in., into which a piece of sheet rubber is inserted.
The rubber may be cut from an old bicycle-tire casing and is
fastened with two or three brads driven through the handle. The
ends of the brads are bent over or riveted. The edge of the rubber
should be made straight.—Contributed by H. S. Craig, Rushford,
Minn.
Protecting Lights in a Gymnasium
A public-school auditorium was used for playing basket ball, and
the lights were protected as shown. Wire waste-baskets were
fastened to pieces of board, which in turn were nailed to the ceiling
around each lamp. As it was desired to provide a way to ventilate the
room, an opening was cut in each board around the lamp base,
providing fan-shaped cut-outs covered with galvanized metal of the
same design, to make a way to open and shut the ventilator. The air
passed up into an attic.
Wire Wastebasket Fastened around a Light to Protect It for Basket-Ball

Games
The goals, which were old blackboards, were fastened between
the posts that supported the ceiling. Two iron rods, one above the
other, were clamped with bolts to the posts, and the boards were
bolted to the rods.—Contributed by Frank C. Svacha, McKees
Rocks, Pa.
Shortening a Pasteboard Box
Shortening a Box by Bending Up the Bottom after Removing the End and
Cutting Down the Sides
If a pasteboard box happens to be too long for a special purpose it

can be shortened as shown. The sides are cut down to the bottom
and the end removed. The bottom is then bent up on a line between
the places where the sides were cut down, to form a new end for the
box. The joining parts are then held with a thread or wire fasteners.
Repairing Shade-Roller Springs
Fig. 1
Fig. 2
Fix the Loosened Spring into Place and the Roller Is in Working Order
Springs of window-shade rollers, which usually break at the tin cap

by which they are fastened inside the rod, can be quickly repaired in
the following manner:
Remove the ferrule and dogs from the end of the roller and pull out
the stick to which the spring is attached. Measure the length of the
stick A, Fig. 1, on the roller, and at C cut a small square hole through
to the hollow center. Remove the metal cap thus exposed. Fix the
cap on the end of the stick at B and fasten the spring around one
point of the metal cap, Fig. 2. Insert the stick into the roller and tap it
gently, driving the cap points in; then replace the ferrule and dogs,
and the roller is in condition for use.
Drying Photo Films Rapidly
The Current of the Fan Dries the Films Rapidly
Waiting for photographic films to dry is often tedious, particularly

when the photographer is in haste to see the results of his efforts at
picture taking. The method of drying the films shown in the sketch
will aid materially in the process. The films are held by small spring
clips attached to the wire frame surrounding the fan, and when the
current is turned on, the films are blown away from the fan and held
suspended in a diagonal position.—Contributed by W. J. Clausius,
Chicago, Ill.
Applying and Drying Bronze Powders
Surfaces may be coated readily with bronze powder by applying a
thin coat of shellac and quickly dusting the powder over it. Speed is
important in dusting on the powder, as if the shellac hardens it will
not hold the bronze. Surfaces which have been bronzed in this way
may be polished if additional coats of shellac or varnish are applied
over them.
Forceps for Weeding Garden
Difficulty in removing small weeds around plants in the garden

may be overcome by the use of a forceps made of a piece of wire,
as shown in the illustration. The wire is formed into two loops by
which the weeds are grasped, and the portion held in the hand is
bent to form a circular spring. Its tension may be regulated so that
the hand will not be tired in using the device.—Contributed by Irving
McEwen, New Westminster, B. C., Canada.
Shielding Pictures from Damp Walls
Injury to pictures from dampness of walls may be prevented by
fixing small disks of cork to the lower edge of the frame so as to form
a contact with the wall only at the cork. This permits a current of air
to pass between the wall and frame.
New Method of Developing Roll Films
By T. B. LAMBERT
Many devices have been made for developing and fixing roll films.
There is the simple wholesale method of the professional who
hangs a weight on one end of the film and lets it down in a deep tank
of developing fluid where it hangs submerged from an upper support
until the development is complete. Then the support, the film, and
attached weight are removed, dipped into a similar tank of running
water, then to another tank of fixing solution, and subsequently
washed and dried.
This is the only practical plan where there are many such films to
be handled simultaneously, but the amateur who has only one or two
rolls a week cannot afford the tanks, the space, nor the expense
incident to such a method. The film is usually drawn back and forth
through a developing solution placed in a tray, and after the
development has proceeded far enough, the same process used in
washing, then the hypo solution, and finally through the last washing
for about 20 minutes, all making a tedious process.
Some amateurs and a few professionals who but occasionally
develop roll film use a mechanical device that rolls the film into a
light-proof package which is inserted in a metal tank for development
and subsequent fixation. This is a standard process, the apparatus
being on sale at all supply houses, but it has its drawbacks.
An Ordinary Drinking Glass Used for Developing Roll Films
The following method is not only simple but perfect in its operation
and requires no special apparatus, only a tumbler or lemonade
glass, and an ordinary lead pencil for its operation. A glass rod is
preferable to the lead pencil, and it is also convenient to have a deep
tin cup, or similar device, to cover up the lemonade glass and make
it light-proof, should it be desirable to turn on the white light in the
dark room.
Pour enough developing solution into the glass tumbler to cover
completely the roll of film when it is standing on end. In the dark
room open the film roll, remove the backing paper and the paper
ends on the film, run it through clear water until it is thoroughly and
uniformly wetted from end to end, and drop it endwise into the
tumbler of developer. Immediately insert the pencil or glass rod into
the center of the roll, and with a rather quick circular motion, move
the rod around so that it will quickly pass between the several
convolutions of the film and thus distribute the developer all over its
surface. Repeat this operation at once, then again in a few seconds,
then in 15 or 20 seconds, then in 30 seconds, then in 1 minute, and
so on, with greater intervals of time. If a 20-minute developer is
used, it will only be necessary, at the latter part of the development,
to separate the layers every 2 or 3 minutes.
When the development is complete, pour off the solution and rinse
in the same glass by letting water run through it while passing the
pencil or glass rod between the layers several times. The water may
then be drained off, and the glass filled with the fixing solution. While
the film is fixing, the glass rod should be passed between the layers
several times to renew the solution in contact with the film.
It will be seen that at no time after the first washing is it necessary
to handle the film, so that damage to the film and staining the fingers
are entirely eliminated. Further than that, no apparatus is tied up in
the operation, and if a light-proof cup is at hand, the developing
tumbler may be covered between the operations of separating the
layers of film, and the white light of the dark room can be turned on
for further operations.
Swinging Bags on the Arms of a Scarecrow
Scarecrow with Swinging Paper Bags on the Arms in the Place of Hands
The ordinary ragman used as a scarecrow can be made more

effective by adding to it something to make it move, or some part
that flutters in the wind. This can be accomplished in one way by
blowing up paper bags to expand them to their full extent, tying the
openings as if they were filled with some commodity for the
household, and fastening them to the arms of the dummy as shown.
These will swing and flutter about in a way that will materially aid in
scaring away the birds that damage the crops.

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Test Bank for Principles of Macroeconomics 11th

Edition Case Fair Oster 0133023672

Diff: 1 Skill: Definition Topic: employment

The unemployment rate is calculated by dividing the number of people

Copyright © 2014 Pearson Education, Inc.

8. What is the official definition of an unemployed person?

9. Using Table 7.1 above, calculate the unemployment rate.

Copyright © 2014 Pearson Education, Inc.

13. Fill in the empty cells in the above table 7.3.

Diff: 1 Skill: Analytic Topic: unemployment

Copyright © 2014 Pearson Education, Inc.

Copyright © 2014 Pearson Education, Inc.

2. A full-time student who is not working

Copyright © 2014 Pearson Education, Inc.

26. Explain what structural unemployment is and give some examples.

Copyright © 2014 Pearson Education, Inc.

27. Explain what is meant by the discouraged-worker effect?

29. List and explain the three major types of unemployment.

31. What are the economic costs of unemployment?

32. Compare and contrast cyclical unemployment and natural unemployment

Copyright © 2014 Pearson Education, Inc.

vacancies. The natural rate of unemployment occurs as the normal functioning of

Event Effect on the natural rate

Copyright © 2014 Pearson Education, Inc.

Event Effect on the natural rate

Diff: 1 Skill: Definition Topic: natural rate of unemployment

Copyright © 2014 Pearson Education, Inc.

Copyright © 2014 Pearson Education, Inc.

classify the individual as frictionally, structurally, or cyclically unemployed. Explain

Copyright © 2014 Pearson Education, Inc.

Copyright © 2014 Pearson Education, Inc.

retraining. Cyclical unemployment could be reduced through expansionary

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when inflation is fully anticipated. Administrative costs, hoarding of real goods,

51. Define inflation.

52. What is the CPI or consumer price index?

55. What is the PPI or producer price index?

Copyright © 2014 Pearson Education, Inc.

The match safe shown in the sketch was made by a worker in a

The difficulty of washing bromide enlargements of the larger sizes

Blowpipe Connection to the Ordinary Illuminating-Gas Main for Hard and

Every experimenter who has a gas connection within convenient

A Dish Scraper Made of a Piece of Rubber Inserted in a Wood Handle

Housekeepers will find the scraper shown to be silent and more

Wire Wastebasket Fastened around a Light to Protect It for Basket-Ball

If a pasteboard box happens to be too long for a special purpose it

Springs of window-shade rollers, which usually break at the tin cap

The Current of the Fan Dries the Films Rapidly

Waiting for photographic films to dry is often tedious, particularly

Difficulty in removing small weeds around plants in the garden

An Ordinary Drinking Glass Used for Developing Roll Films

The ordinary ragman used as a scarecrow can be made more

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