Problem_Set_1_Wilson_Lisa

# Unemployed c bob was laid off as a carpenter when a

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model changeover, but he expects to be recalled in a couple of weeks. Unemployed c. Bob was laid off as a carpenter when a construction project was completed. He is looking for work but has been unable to find anything except a \$10 per hour job which he turned down. Unemployed d. Jade works 70 hours per week as a homemaker for her family of 6. Not in the labor force e. Carson, a 17-year-old, works six hours per week as a delivery person for the local newspaper. Employed f. Brady works three hours in the mornings at the clinic and for the last two weeks has spent the afternoons looking for a full-time job. Employed

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ECON 214 3. Use the following data to calculate (a) the labor force participation rate 48.6% , (b) the unemployment rate 16.4% , and (c) the employment/population ratio 40.6% . Population age 16 and over 15,000 Labor force 7,300 Not currently working 4,500 Employed Full- time 5,000 Employed Part- time 1,100 Unemployed. 1,200 4. Consider an economy with the following aggregate demand (AD) and short-run aggregate supply (SRAS) schedules. Decision-makers have previously made decisions anticipating that the price level during the current period will be P 105 . a. Indicate the quantity of GDP that will be produced during the period. 5,100 b. Is it a long-run equilibrium level of GDP? Why or why not? No. The actual price level will be 110, which is higher than expected. c. How will the unemployment rate during the current period compare with the natural rate of unemployment? Unemployment rate will be lower than the natural rate due to higher price levels improving the profit margin, reducing real wage rates, and expansion of output during short run. d. Will the current rate of GDP be sustainable into the future? Why or why not? No. Real wages will increase due to the ability to negotiate existing contracts. AD 105 Price Level SRAS 105 6300 90 4500 6000 95 4800 5700 100 5100 5400 105 5400 5100 110 5700 4800 115 6000 This assignment is due by 11:59 p.m. (ET) on Monday of Module/Week 2.
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