COVID-19 has impacted the global economy, spreading across nations with alarming speed, infecting millions. According to Statista, India saw an unemployment rate of 6 percent in January 2021, higher than the pre-pandemic level. Unemployment rate had gone up to nearly 24 percent in April 2020. This was possibly a result of a decrease in demand as well as the disruption of workforce faced by companies. Despite a modest recovery, the economy is still far-off the pre-pandemic level. Given this scenario, which of the following might happen? Consumer spending on luxury goods will increase. Consumer spending for food will increase. Government expenditure will increase. Investment for pharmaceutical products might increase. O O O

COVID-19 has impacted the global economy, spreading across nations with alarming speed, infecting millions. According to Statista, India saw an unemployment rate of 6 percent in January 2021, higher than the pre-pandemic level. Unemployment rate had gone up to nearly 24 percent in April 2020. This was possibly a result of a decrease in demand as well as the disruption of workforce faced by companies. Despite a modest recovery, the economy is still far-off the pre-pandemic level. Given this scenario, which of the following might happen? Consumer spending on luxury goods will increase. Consumer spending for food will increase. Government expenditure will increase. Investment for pharmaceutical products might increase. O O O

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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As businesses reopen after the shut down response to the Covid virus, the unemployment rate is exceptionally high and the economy is likely producing far below its potential. Identify a policy that may help lift the economy out of this slump. Present an analysis where you explain the impact you expect from your policy on output, prices, wages, employment, and unemployment.
Which of the following is INCORRECT? In a typical month more than 5 percent of workers leave their jobs. Frictional unemployment is inevitable in a dynamic economy. Although the unemployment created by sectoral shifts is unfortunate, in the long run such changes lead to higher productivity and higher living standards. At least 10 percent of U.S. manufacturing jobs are destroyed every year.
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