Macroeconomics
10th Edition
ISBN: 9781319105990
Author: Mankiw, N. Gregory.
Publisher: Worth Publishers,
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Chapter 7, Problem 9PA
To determine
Explain how the unemployed capital is related to unemployed labor.
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- The rate of job separations in the economy is 0.013 (1.3 percent) and rate of job finding is 0.25 (25 percent). a) If the economy has 500 workers in the labor force, calculate the unemployment rate and the number of unemployed in the steady state. b) If the rate of job separations is 1 percent, what happens to the unemployment rate and the number of unemployed in the steady state? c) If labor force suddenly increases by 20 workers who are seeking work (and the rate of job separations remains at 1 percent), what is the immediate change in the unemployment rate? What is the new steady-state unemployment rate? Draw a graph on how unemployment rate evolves in time.arrow_forwardBetween January 2010 and January 2016, U.S. employment increased by 12.1 million workers, but the number of unemployed workers declined by only 7.3 million. How are these numbers consistent with each other? Why might one expect a reduction in the number of people counted as unemployed to be smaller than the increase in the number of people employed?arrow_forwardUnemployment is a very important topic in macroeconomics. A high unemployment rate means that a lot of individuals willing to work cannot find a job. This is bad for the economy, as some resources (i.e., labour) remain idle. Comment on the effects that being unemployed have on an individual.arrow_forward
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- Discuss the historical patterns of unemployment of any chosen economy.arrow_forwardA country with a civilian population of 120,000 (all over age 16) has 100,000 employed and 10,000 unemployed persons, of which 5,000 are frictionally unemployed and another 3,000 structurally unemployed. Given the above data, complete the following questions, show your work: a. What is the employment/population ratio? b. What is the natural rate of unemployment?arrow_forwardWhich of the following pictures best describes the impact on the labor market of a reduction of the unemployment benefit? upH(w*,) upH(w*,) s(1-U) s(1-U) v,(w*,) upH(w*,) upH(w*,) (b) (a) W upH(w*) s,(1-U) (d) upH(w",) V,(w*) V,(w*,) upH(w*,) s(1-U) s,(1-U) V,(w*,) (c) U U W а. (а) b. (b) с. (с) d. (d) w/arrow_forward
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