1. Why might a favorable change in the economy, such as technological improvement or a decrease in the price of imported oil, be associated with an increase in frictional unemployment? 2. Suppose that there is an excess supply of economics professors. Should universities necessarily reduce salaries? What does standard economic theory suggest? What does efficiency-wage theory suggest? 3. What is the theory of efficiency wages? Provide four reasons that employers might pay efficiency wages. 4. Unemployment Rate/employment-population ratio Chapter 15; Page 318 # 4; Economists use labor market data to evaluate......... (there are questions a-f) 5 Short-term/long-term unemployment rate Chapter 15; Page 318: # 5; Are the following workers more likely to experience short-term or long-term unemployment? Explain (there are questions a-e)
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A favorable change in the economy, such as technological improvement or a decrease in the price of imported oil, can lead to an increase in frictional unemployment for several reasons: - Technological improvement: When new technologies are introduced, some jobs Show more…
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