Question

11. 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 the unemployment rate and the employment-population ratio in each of the following scenarios. Effect On... Scenario Many previously laid-off workers find jobs in new startup firms as the economy expands. After an unsuccessful search, some laid-off workers quit looking for new jobs. Numerous students graduate from college and immediately begin new jobs. A stock market crash leads to large-scale lay-offs of workers aged 55 and above, who decide to retire instead of looking for new jobs. Unemployment Rate Employment-Population Ratio

          11. 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 the unemployment rate and the employment-population ratio in each of the following scenarios.
Effect On...
Scenario
Many previously laid-off workers find jobs in new startup firms as the economy
expands.
After an unsuccessful search, some laid-off workers quit looking for new jobs.
Numerous students graduate from college and immediately begin new jobs.
A stock market crash leads to large-scale lay-offs of workers aged 55 and above,
who decide to retire instead of looking for new jobs.
Unemployment Rate
Employment-Population
Ratio

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11. 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 the unemployment rate and the employment-population ratio in each of the following scenarios.
Effect On...
Scenario
Many previously laid-off workers find jobs in new startup firms as the economy
expands.
After an unsuccessful search, some laid-off workers quit looking for new jobs.
Numerous students graduate from college and immediately begin new jobs.
A stock market crash leads to large-scale lay-offs of workers aged 55 and above,
who decide to retire instead of looking for new jobs.
Unemployment Rate
Employment-Population
Ratio

Added by Yolanda Q.

Principles of Economics

Gregory Mankiw 8th Edition

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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 the unemployment rate and the employment-population ratio in each of the following scenarios. Effect On... Scenario Many previously laid-off workers find jobs in new startup firms as the economy expands. After an unsuccessful search, some laid-off workers quit looking for new jobs. Numerous students graduate from college and immediately begin new jobs. A stock market crash leads to large-scale lay-offs of workers aged 55 and above, who decide to retire instead of looking for new jobs. 11.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 the unemployment rate and the employment-population ratio in each of the following scenarios. Effect On... Scenario Employment-Population Unemployment Rate Ratio Many previously laid-off workers find jobs in new startup firms as the economy expands. After an unsuccessful search, some laid-off workers quit looking for new jobs Numerous students graduate from college and immediately begin new jobs. A stock market crash leads to large-scale lay-offs of workers aged 55 and above who decide to retire instead of looking for new jobs.

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Transcript

00:01 So here we're talking about labor force statistics in terms of two variables, the unemployment rate, which is the number of unemployed people over the number of unemployed people plus the number of employed people, right? sometimes this is called the labor force, the number of unemployed plus the number of employed people and the employment to population ratio.

00:23 And so this is the number of people who are employed over the number of, uh, usually it's 16 plus population, right? so here we have four stories.

00:34 The first story is, uh, laid off, find jobs.

00:41 And we are evaluating these stories in terms of the unemployment rate and the employment to population ratio.

00:48 So here, the unemployment rate is clearly going to go down, right? the unemployed are finding jobs.

00:54 That is they're disappearing from the top of that unemployment fraction.

00:58 The employment population ratio is also going up because you have more people with jobs, right? so unemployment down, employment population ratio goes up to, um, exactly the same thing, right? laid off workers are finding jobs.

01:17 This is precisely identical to the first one.

01:21 Again, the unemployment rate is going down.

01:23 The unemployment population rate is going up.

01:25 It's the exact same story.

01:27 It says people are still finding jobs.

01:29 The fact that they were looking for a long time is irrelevant...

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