Essentials of Economics
4th Edition
ISBN: 9781464186653
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 5P
To determine
To determine: The number of workers employed in each region during the given period of time.
Concept Introduction
Labor Force: Labor force refers to the total number of workers in an economy which includes employed as well as unemployed workers.
Expert Solution & Answer
Explanation of Solution
a. Number of employed workers in April 2013 and April 2014.
The formula to calculate the number of employed workers is as follows:
The below table shows the calculation of employed workers:
April 2013
| Region | Labor Force(Thousands)(A) | Unemployed Workers(Thousands)(B) | Employed Workers(Thousands) |
| Northeast | 28,407.2 | 2,174.4 | 26,232.8 |
| South | 56,787.8 | 4,089.9 | 52,697.9 |
| Midwest | 34,320.0 | 2,473.7 | 31,846.3 |
| West | 36,122.2 | 2,940.8 | 33,181.4 |
| Total | 143,958.4 |
April 2014
| Region | Labor Force(Thousands)(A) | Unemployed Workers(Thousands)(B) | Employed Workers(Thousands) |
| Northeast | 28,288.9 | 1,781.3 | 26,507.6 |
| South | 57,016.4 | 3,363.8 | 53,652.6 |
| Midwest | 34,467.0 | 2,109.0 | 32,358.0 |
| West | 36,307.3 | 2,535.7 | 33,771.6 |
| Total | 146,289.8 |
The change in the number of employed workers between April 2013 and April 2014 shall be calculated as follows:
Conclusion:
Thus, there is an increase in number of employed workers between April 2013 and April 2014.
b. Growth in labor force.
The formula to calculate the growth in labor force between April 2013 and April 2014 is as follows:
The below table shows the calculation of growth in labor force in each region:
| Region | Labor Force in April 2013(Thousands)(A) | Labor Force in April 2014(Thousands)(B) | Growth in Labor Force(%) |
| Northeast | 28,407.2 | 28,288.9 |  |
| South | 56,787.8 | 57,016.4 | 0.41 |
| Midwest | 34,320.0 | 34,467.0 | 0.43 |
| West | 36,122.2 | 36,307.3 | 0.51 |
Conclusion:
Thus, there is a decrease in labor force in the Northeast and a growth in other regions.
c.
The formula to calculate the unemployment rate is as follows:
The below table shows the calculation of unemployment rate in each region:
April 2013
| Region | Labor Force(Thousands)(A) | Unemployed Workers(Thousands)(B) | Unemployment Rate(%) |
| Northeast | 28,407.2 | 2,174.4 | 7.65 |
| South | 56,787.8 | 4,089.9 | 7.20 |
| Midwest | 34,320.0 | 2,473.7 | 7.21 |
| West | 36,122.2 | 2,940.8 | 8.14 |
April 2014
| Region | Labor Force(Thousands)(A) | Unemployed Workers(Thousands)(B) | Unemployment Rate(%) |
| Northeast | 28,288.9 | 1,781.3 | 6.3 |
| South | 57,016.4 | 3,363.8 | 5.9 |
| Midwest | 34,467.0 | 2,109.0 | 6.12 |
| West | 36,307.3 | 2,535.7 | 6.98 |
Conclusion:
Thus, there is a decrease in unemployment rate in all the regions between April 2013 and April 2014.
d. Reason for fall in unemployment rate.
The unemployment rate has decreased in all the regions between April 2013 and April 2014.
The decrease in unemployment rate is shown in the table below:
| Region | Unemployment RateApril 2013(A)(%) | Unemployment RateApril 2014(B)(%) | Fall in Unemployment Rate(%) |
| Northeast | 7.65 | 6.3 | 1.35 |
| South | 7.20 | 5.9 | 1.3 |
| Midwest | 7.21 | 6.12 | 1.09 |
| West | 8.14 | 6.98 | 1.16 |
- It can be seen that in the regions of South, Midwest and West, the labor force has increased from April 2013 to April 2014.
- Hence, in these regions, the fall in unemployment rate is due to considerable net gain in the number of jobs.
- However, there is decrease in labor force in Northeast and still there is fall in unemployment rate due to the fall in number of people seeking jobs.
Conclusion:
Thus, there is a fall in unemployment rate.
Want to see more full solutions like this?
Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!
Students have asked these similar questions
Where can I go to get my own wax supplies?
Problem 2. If the consumer preference can be represented by a CES function with δ = 0.5, i.e. u(x, y) = x0.5 + y0.5. Let the prices and income be (px, py, w).
1. Set up the Lagrangian expression.2. Take the first-order conditions.3. Substitute into budget constraint to derive the optimal consumption bundles.
1. A town relies on four different sources for its non-drinking water needs: dam water,
reclaimed water, rain water, and desalinated water. The different sources carry different
risks and costs. For instance, desalinated water is fully reliable due to abundant sea water,
but it is more expensive than other options. Reclaimed water also has relatively lower
risk than rain or dam water since a certain amount can be obtained, even during the dry.
season, by the treatment of daily generated waste water.
Using any of the four options requires an investment in that resource. The return on a
particular water source is defined as the amount of water generated by the source per
dollar of investment in it. The expected returns and standard deviations of those returns
for the four water sources are described in the following table:
Water resource
Expected return St. Deviation
Dam water
2.7481
0.2732
Reclaimed water
1.6005
0.0330
Rain water
0.5477
0.2865
Desalinated water
0.3277
0.0000
Higher…
Knowledge Booster
Similar questions
- 1. Imagine a society that produces military goods and consumer goods, which we'll call "guns" and "butter." a. Draw a production possibilities frontier for guns and butter. Using the concept of opportunity cost, explain why it most likely has a bowed-out shape. b. Show a point that is impossible for the economy to achieve. Show a point that is feasible but inefficient. c. Imagine that the society has two political parties, called the Hawks (who want a strong military) and the Doves (who want a smaller military). Show a point on your production possibilities frontier that the Hawks might choose and a point the Doves might choose. d. Imagine that an aggressive neighboring country reduces the size of its military. As a result, both the Hawks and the Doves reduce their desired production of guns by the same amount. Which party would get the bigger "peace dividend," measured by the increase in butter production? Explain.arrow_forwardA health study tracked a group of persons for five years. At the beginning of the study, 20%were classified as heavy smokers, 30% as light smokers, and 50% as nonsmokers. Resultsof the study showed that light smokers were twice as likely as nonsmokers to die duringthe five-year study, but only half as likely as heavy smokers.A randomly selected participant from the study died during the five-year period. Calculatethe probability that the participant was a heavy smokerarrow_forwardConsider two assets with the following returns: State Prob. of state R₁ R2 1 23 13 25% 5% 2 -10% 1% Compute the optimal portfolio for an investor having a Bernoulli utility of net returns u(r) = 2√√r+ 10. Compute the certainty equivalent of the optimal portfolio. Do the results change if short-selling is not allowed? If so, how?arrow_forward
- In the graph at the right, the average variable cost is curve ☐. The average total cost is curve marginal cost is curve The C Cost per Unit ($) Per Unit Costs A 0 Output Quantity Barrow_forwardWhat are some of the question s that I can ask my economic teacher?arrow_forwardAnswer question 2 only.arrow_forward
- 1. A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate fund, and the third is a (riskless) T-bill money market fund that yields a rate of 8%. The probability distributions of the risky funds have the following characteristics: Standard Deviation (%) Expected return (%) Stock fund (Rs) 20 30 Bond fund (RB) 12 15 The correlation between the fund returns is .10.arrow_forwardFrederick Jones operates a sole proprietorship business in Trinidad and Tobago. His gross annual revenue in 2023 was $2,000,000. He wants to register for VAT, but he is unsure of what VAT entails, the requirements for registration and what he needs to do to ensure that he is fully compliant with VAT regulations. Make reference to the Vat Act of Trinidad and Tobago and explain to Mr. Jones what VAT entails, the requirements for registration and the requirements to be fully compliant with VAT regulations.arrow_forwardCan you show me the answers for parts a and b? Thanks.arrow_forward
- What are the answers for parts a and b? Thanksarrow_forwardWhat are the answers for a,b,c,d? Are they supposed to be numerical answers or in terms of a variable?arrow_forwardSue is a sole proprietor of her own sewing business. Revenues are $150,000 per year and raw material (cloth, thread) costs are $130,000 per year. Sue pays herself a salary of $60,000 per year but gave up a job with a salary of $80,000 to run the business. ○ A. Her accounting profits are $0. Her economic profits are - $60,000. ○ B. Her accounting profits are $0. Her economic profits are - $40,000. ○ C. Her accounting profits are - $40,000. Her economic profits are - $60,000. ○ D. Her accounting profits are - $60,000. Her economic profits are -$40,000.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education