Workshop_2_HW_Problems_and_Answers - MONITORING JOBS AND...

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M O N I T O R I N G J O B S A N D I N F L A T I O N 1 Workshop 2 HW Problems and Answers 1 1. Should discouraged workers be counted as part of the unemployment rate? By definition, discouraged workers should not be counted as unemployed because they are not searching for employment. However, the real issue is whether the definition is appropriate. On the one hand, these people have given up looking for a job because they cannot find one. On the other hand, because these people have given up looking for a job they are quite unlikely to find one. So discouraged workers are different from other unemployed workers because discouraged workers are unlikely to find work since they have stopped search. All in all, it is probably better that discouraged workers not be counted directly with other unemployed workers because their low likelihood of finding work makes them fundamentally different than other unemployed workers. 1
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This note was uploaded on 09/13/2011 for the course ECON 206 taught by Professor Parkin during the Spring '11 term at Buena Vista.

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Workshop_2_HW_Problems_and_Answers - MONITORING JOBS AND...

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