Economists use labor-market data to evaluate how well an economy is using its most valuable resource-its people. Two closely watched statistics are the unemployment rate and the employment-population ratio (calculated as the percentage of the adult population that is employed). Indicate what happens to the unemployment rate and the employment-population ratio in each of the following scenarios. Effect On... Employment-Population Scenario Unemployment Rate Ratio A financial firm goes bankrupt and lays off its workers, who immediately start working in other financial firms. After a long search, some laid-off workers find new jobs. As a result of an economic boom, many students drop out of school and start working as soon as they become adults. A stock market crash leads to large-scale lay-offs of workers aged 55 and above, who decide to retire instead of looking for new jobs.

Economists use labor-market data to evaluate how well an economy is using its most valuable resource-its people. Two closely watched statistics are the unemployment rate and the employment-population ratio (calculated as the percentage of the adult population that is employed). Indicate what happens to the unemployment rate and the employment-population ratio in each of the following scenarios. Effect On... Employment-Population Scenario Unemployment Rate Ratio A financial firm goes bankrupt and lays off its workers, who immediately start working in other financial firms. After a long search, some laid-off workers find new jobs. As a result of an economic boom, many students drop out of school and start working as soon as they become adults. A stock market crash leads to large-scale lay-offs of workers aged 55 and above, who decide to retire instead of looking for new jobs.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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You have been asked to provide expertise on the macroeconomic conditions of several countries, and have been given the following information about the labor force, number of employed workers, and natural rate of unemployment in each country: Country Labor Force (millions) Employed (millions) Natural rate of unemployment Bumdumbourge 130 120 6.3% Mundelow 465 437 6.5% Totalslava 88 82 6.9% Potamia 285 264 7.3% Dortugal 311 295 5.5% Prance 396 355 9.2% a. From the data given, which country has the largest number of unemployed people? b. Totalslava has the smallest number of unemployed people; how does its unemployment rate compare to Bumdumbourge and Mundelow? c. Which countries are currently in recession? Which countries are experiencing a boom?
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