. How does the government officially measure employment and unemployment in the economy? Why is it usually stated that the official unemployment rate likely underestimates the actual level of unemployment in the economy?
Unemployment rate is calculated as a percentage by dividing number of unemployed individuals by total individuals currently in the labor force. Usually there is high unemployment during recession. Here unemployed workers refer to those who are currently not employed but are willing and able to work for pay and are actively searching for work.
Unemployment rate is usually called as a lagging indicator of
the economy, as actually the economy shows improvement before the
unemployment rate rises again. This creates a ripple effect in the
economy. If there is less employment, then people have less
disposable income, thus less money for investment and lesser taxes
collected by the government. The actual state of the economy, in
terms of its ability to generate jobs for its citizens thus depends
on various factors like economic growth of a country, per capita
income, wages, trade unions, inflation rate etc.
Labour force participation rate (LFPR) refers to the active
eportion of a labour’s economy. Thus it includes people who are
either employed or are actively looking for work. Participation
rate is an important metric because unemployment figures reflect
the number of people who are searching for jobs but are unable to
secure employment.
. How does the government officially measure employment and unemployment in the economy? Why is it...
A Explain briefly why actual unemployment is never zero even when the economy is considered to be in a state of full employment. B why do economists and business investors expect inflation to accelerate when actual unemployment falls below the natural rate of unemployment (NAIRU)? C What is the current actual unemployment rate for the US economy? Do you think the current unemployment rate is less than, equal to or above NAIRU?Explain your answer.
discussion:2 Effects of Unemployment and Inflation This Discussion focuses on how to measure the cost of living and rate of unemployment in the economy. Specific discussion areas include the various forms of unemployment and how they are measured, debates on measuring unemployment rate, and the imperfections of official unemployment rate. Moreover, consumer price index (CPI), rate of inflation, and their impacts on the cost of living. Read Chapter 8, and remember to include references and links to the websites that...
HOMEWORK B2a & b - Required Chapter ‘Unemployment and Inflation’ Q1. Refer to Exhibit 1 in the chapter to determine whether each of the following statements is true or false. Some people who are officially unemployed are not in the labor force. Some people in the labor force are not working. Everyone who is not unemployed is in the labor force. Some people who are not working are not unemployed. Q6. Explain why most experts believe that official U.S....
Why should federal and state government agencies track employment and unemployment data? Why should they be concerned about the under-employed and discouraged workers?
Suppose an economy were experiencing a high rate of unemployment, an appropriate corrective measure by the government would be to: reduce personal income tax. reduce government spending. reduce unemployment compensation reduce the rate of interest for borrowing reduce transfer payments.
Without cyclical unemployment in the country, which isn’t true? Economy is at max employment level The unemployment rate = 0% economy ‘s unemployment rate is at what we consider its natural rate Inflation rate with CPI shows: % change in the price level from one period to another period Real variables Average price level in one time period The value of intermediate goods is calculated in GDP by: Their value is not counted separately, but included as part of the...
The Federal Government is concerned about the level of unemployment in the economy. It is seeking the most efficient means of reducing unemployment by 200,000? How close to this target could they come, if the government spent $10 billion of highways, bridges, hospitals, and schools?
The Federal Government is concerned about the level of unemployment in the economy. It is seeking the most efficient means of reducing unemployment by 200,000? How close to this target could they come, if the government spent $10 billion of highways, bridges, hospitals, and schools?
The following table contains U.S. employment information from June 2019. Civilian Population (Persons 16 years old and over) 259,037,000 Employed (Persons) 157,005,000 Unemployed (Persons) 5,975,000 Discouraged (Persons) 425,000 The Bureau of Labor Statistics has several measures of joblessness in addition to the official unemployment rate. One alternative is the U-4 measure of labor underutilization, which is calculated as follows Fill in the following table by calculating the official unemployment rate and the U-4 measure of labor underutilization. Official Unemployment Rate...
1. If the economy is at full employment, increases in government spending: A) have a multiplier effect on equilibrium output. B) have no effect on the aggregate price level. C) are primarily absorbed by price increases. D) reduce aggregate output. 2. Which of the following measures is NOT an example of discretionary fiscal policy? A) The unemployment compensation program pays out more money as unemployment rates rise. B) Tax rates are increased in the hope of slowing down the rate...