5. Problems and Applications Q5 Economists use labor-market data to evaluate how

Question

5. Problems and Applications Q5 Economists use labor-market data to evaluate how well an economy is using its most valuable resource-its people. Two closely watched statistics are the unemployment rate and the employment-population ratio (calculated as the percentage of the adult population that is employed). Indicate what happens to thel unemployment rate and the employment-population ratio in each of the following scenarios Effect On... Employment-Population Ratio Unemployment Rate Scenario Many previously laid-off workers find jobs in new startup firms as the economy expands. After a long search, some laid-off workers find new jobs. As a result of an economic boom, many students drop out of school and start working as soon as they become adults Advances in health care prolong the lives of many retirees. Stays the arne ? Decreases Save & Continue Grade It Now Continiun without saving ? Tutorial-14-soluti doc

Explanation / Answer

(1) With the expanding economy, employees start getting jobs in a start-up which means that the employment in the economy is going up. The employment -Population ratio will go up as the employment is increasing.

Unemployment Rate: Decrease

Employment - Population Ratio: Increase

(2) Some laid-off workers finding jobs means that the employment in the economy is going up. The employment -Population ratio will go up as the employment is increasing.

Unemployment Rate: Decrease

Employment - Population Ratio: Increase

(3) As a result of booming,many students drop out and start working which means that that the employment in the economy is going up. Unemployment counts only people who are jobless and actively looking for job. Full-time students are not counted in the unemployment rate but since they have dropped out, they will. So, the employment -Population ratio will go up as the employment is increasing.

Unemployment Rate: Decrease

Employment - Population Ratio: Increase

(4) Advances in helath care are increasing the lives of retirees will not impact the unemploymnet rate retirees are not counted during the calculation of the Unemployment rate. Also, for Employment - Population Ratio, the population factor doesn't consider retirees.

Unemployment Rate: No-change

Employment - Population Ratio: No-change

Related Questions

Navigate

• Browse (All)
• Browse 5
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.