Asap upvote guarantee QUESTION 7 An unusually large age cohort (e.g. the baby bo

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QUESTION 7 An unusually large age cohort (e.g. the baby boomers) reaches the age of retirement. Assuming all of them are employed right before they go into retirement and nothing else changes in the economy, their retirement will have the following effects the unemployment rate will decrease and the labor force participation rate will decrease O the unemployment rate will increase and the labor force participation rate will increase the unemployment rate will decrease and the labor force participation rate will increase the unemployment rate will increase and the labor force participation rate will decrease

Explanation / Answer

Right answer is " The unemployment rate will increase and labor force participation rate will decrease"

When working people retire, they reduce labor force availability but do not affect unemployment in absolute term.

When labor force falls, unemployment rate increases in relative term.

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