If households expect a recession will come soon, will this increase the natural rate of unemployment?...
- If households expect a recession will come soon, will this increase the natural rate of unemployment? Explain.
- A recession really occurs, but unemployment rate decreases. Explain how this can be possible.
Homework Answers
Since natural rate of unemployment takes into account only frictional and structural unemployment and not cyclical unemployment, the anticipation of recession as business cycle will not increase natural rate of unemployment.
Recession occurs however unemployment decreases because government reacts fatser by stimulating economic growth and injecting liquidity which helps firms to hire more. Moreover, even central banks infuses money supply which helps lower unemployment as hiring activity kicks up.
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If households expect a recession will come soon, will this
increase the natural rate of unemployment?...
If households expect a recession will come soon, will this increase the natural rate of unemployment?...
If households expect a recession will come soon, will this increase the natural rate of unemployment? Explain. A recession really occurs, but unemployment rate decreases. Explain how this can be possible. The government makes it more difficult for companies to lay off their workers. However, unemployment rate increases as a result. Explain
(b) If households expect a recession will come soon, will this increase the natural rate of...
(b) If households expect a recession will come soon, will this increase the natural rate of unemployment? Explain. (c) A recession really occurs, but unemployment rate decreases. Explain how this can be possible. (d) The government makes it more difficult for companies to lay off their workers. However, unemployment rate increases as a result. Explain.
Consider the US loanable funds market. For each of the following separate scenarios, draw a graph...
Consider the US loanable funds market. For each of the following separate scenarios, draw a graph to show how the equilibrium interest rate and equilibrium quantity of loanable funds changes. Banks impose more regulations and make it more difficult for firms to borrow. Productivity of machines decreases. Households are less confident about the economy, they expect a recession will come soon. If households expect a recession will come soon, will this increase the natural rate of unemployment? Explain. A recession...
(a) Consider the US loanable funds market. For each of the following separate scenarios, draw a...
(a) Consider the US loanable funds market. For each of the following separate scenarios, draw a graph to show how the equilibrium interest rate and equilibrium quantity of loanable funds changes. (i) Banks impose more regulations and make it more difficult for firms to borrow. (ii) Productivity of machines decreases. (iii) Households are less confident about the economy, they expect a recession will come soon. (b) If households expect a recession will come soon, will this increase the natural rate...
Decoding 'Natural' Rate of Unemployment Unemployment is a normal feature of our economy and the Congressional...
Decoding 'Natural' Rate of Unemployment Unemployment is a normal feature of our economy and the Congressional Budget Office believes the "natural" unemployment rate increased from 5 percent in 2007 to 6 percent in 2012. Source: Wall Street Journal, September 7, 2012 Provide some reasons why the natural unemployment rate might have increased. The natural unemployment rate might have increased because of _______. A. an increase in the minimum wage and an increase in the number of firms paying an efficiency...
The natural unemployment rate is the unemployment rate when the economy is in A neither a...
The natural unemployment rate is the unemployment rate when the economy is in A neither a recession nor a boom. B any part of the business cycle. C a boom. D a recession
The natural unemployment rate is not zero because natural unemployment includes O A. cyclical and structural...
The natural unemployment rate is not zero because natural unemployment includes O A. cyclical and structural unemployment O B. frictional and cyclical unemployment Oc frictional and structural unemployment OD. Cyclical unemployment O E. discouraged workers during an expansion The unemployment rate fluctuates around the natural unemployment rate O A frictional unemployment increases, decreases OD cyclical unemployment decreases increases OG Structural unemployment increases, decreases OD. cyclical unemployment increases, decreases OL frictional unemployment decreases increases
22. The type of unemployment that occurs as a result of a recession is called: A....
22. The type of unemployment that occurs as a result of a recession is called: A. cyclical unemployment. B. the natural rate of unemployment. C. seasonal unemployment. D. frictional unemployment.
Which of the following would reduce the natural rate of unemployment? a. an increase in the...
Which of the following would reduce the natural rate of unemployment? a. an increase in the rate of money growth but not increased unemployment compensation b. an increase in unemployment compensation but not an increase in the rate of money growth. c. neither an increase in unemployment compensation nor an increase in the rate of money growth. d. both an increase in the rate of money growth and increased unemployment compensation
Cyclical unemployment can best be described as the increase in unemployment when the economy is in...
Cyclical unemployment can best be described as the increase in unemployment when the economy is in a boom. o increase in unemployment when the economy is in a recession. amount of unemployment when real and potential GDP are equal. O increase in unemployment above the natural rate during and in the aftermath of recessions. O amount of unemployment when real and nominal GDP are equal.
(a) Consider the US loanable funds market. For each of the following separate scenarios, draw a graph to show how the equilibrium interest rate and equilibrium quantity of loanable funds changes. (i) Banks impose more regulations and make it more difficult for firms to borrow. (ii) Productivity of machines decreases. (iii) Households are less confident about the economy, they expect a recession will come soon. (b) If households expect a recession will come soon, will this increase the natural rate...
The natural unemployment rate is the unemployment rate when the economy is in A neither a recession nor a boom. B any part of the business cycle. C a boom. D a recession
The natural unemployment rate is not zero because natural unemployment includes O A. cyclical and structural unemployment O B. frictional and cyclical unemployment Oc frictional and structural unemployment OD. Cyclical unemployment O E. discouraged workers during an expansion The unemployment rate fluctuates around the natural unemployment rate O A frictional unemployment increases, decreases OD cyclical unemployment decreases increases OG Structural unemployment increases, decreases OD. cyclical unemployment increases, decreases OL frictional unemployment decreases increases
22. The type of unemployment that occurs as a result of a recession is called: A. cyclical unemployment. B. the natural rate of unemployment. C. seasonal unemployment. D. frictional unemployment.
Which of the following would reduce the natural rate of unemployment? a. an increase in the rate of money growth but not increased unemployment compensation b. an increase in unemployment compensation but not an increase in the rate of money growth. c. neither an increase in unemployment compensation nor an increase in the rate of money growth. d. both an increase in the rate of money growth and increased unemployment compensation
Cyclical unemployment can best be described as the increase in unemployment when the economy is in a boom. o increase in unemployment when the economy is in a recession. amount of unemployment when real and potential GDP are equal. O increase in unemployment above the natural rate during and in the aftermath of recessions. O amount of unemployment when real and nominal GDP are equal.
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