Derive the steady state level of unemployment and the steady state unemployment rate in the bathtub model

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A: Steady state unemployment rate = s/(s+f) = 0.02/(0.02+0.53) = 0.02/0.55 * 100 = 3.6% Steady state…

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Unemployment and Cost of Unemployment

Unemployment is the state of being unemployed, even when an individual is actively seeking work opportunities. The unemployment rate refers to the percentage of the workforce that is currently unemployed.