201C6ol - Chapter 6 UNEMPLOYMENT When is a person...

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Chapter 6 - UNEMPLOYMENT - When is a person unemployed? - What are the costs of unemployment? - What is an appropriate goal for "full" employment? -Harry Truman when asked "When is unemployment too high?" he said "it depends on whether or not you have a job." -Labor Force--all people 16 and older who are either working for pay or actively seeking paid employment -People that are neither working or actively seeking work are not counted as part of the labor force -The Labor Force (old T-26)--note who is "IN" and "OUT" -Labor-Force Participation Rate--the % of the population working or looking for employment; found by taking the labor force / total population -Physical vs. Institutional Production Possibilities (T-26): -Physical is what could be produced if all resources and technology were used -Institutional is what can be made by available resources, technology, and social constraints -The "IPP" always lies inside the "PPP." -Okun's Law--1% more unemployment = about 2% less output
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-Measuring Unemployment (remember that if a person is both not
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