assuming no other changes occur.
Solution:
To calculate the size of the labor force at the end of the year, we need to add up all the changes that will occur during the year:
Starting labor force = Total workers = 10000
Workers who will lose their jobs = -200
Workers who will return to the labor force = +170
Workers who will voluntarily leave their jobs = -100
New workers who will enter the labor force = +500
Workers who will find jobs = +933
Workers who will retire or leave the labor force = -300
Ending labor force = Starting labor force + (changes)
= 10000 - 200 + 170 - 100 + 500 + 933 - 300
= 11003
Therefore, at the end of the year, the labor force in Economica will consist of 11,003 workers.
In the country of Economica, the total labor force consists of workers. 400 of these workers are unemployed, and thus the current unemployment rate is 4.0%. This year, 200 workers will lose their jobs, 170 workers will return to the labor force after an absence, 100 workers will voluntarily leave their jobs, and 500 new workers will enter the labor force. At the same time, 933 workers will find jobs, and 300
workers will retire or leave the labor force for other reasons.
a. At the end of the year, the labor force will consist of ----
workers,
3 answers
b. The unemployment rate will be---%.
(Round your responses to one decimal place.)
(Round your responses to one decimal place.)
Solution:
To calculate the unemployment rate at the end of the year, we need to calculate the number of unemployed workers and then divide by the total labor force:
Unemployed workers at the beginning of the year = 400
New workers who will enter the labor force = +500
Workers who will find jobs = -933
Unemployed workers at the end of the year = Unemployed workers at the beginning of the year + (changes)
= 400 + 500 - 933
= -33
Note that the result is negative. This means that there are fewer unemployed workers at the end of the year than at the beginning, which is a good thing.
However, we need to adjust for the fact that the unemployment rate cannot be negative. To do this, we assume that the number of unemployed workers at the end of the year is zero. This means that all the new workers who entered the labor force found jobs, and all the workers who lost jobs or voluntarily left the labor force were not seeking employment.
Adjusted ending labor force = Ending labor force - number of unemployed workers
= 11003 - 33
= 10970
Unemployment rate = number of unemployed workers / adjusted ending labor force
= 0 / 10970
= 0% (rounded to one decimal place)
Therefore, the unemployment rate at the end of the year in Economica will be 0%.
To calculate the unemployment rate at the end of the year, we need to calculate the number of unemployed workers and then divide by the total labor force:
Unemployed workers at the beginning of the year = 400
New workers who will enter the labor force = +500
Workers who will find jobs = -933
Unemployed workers at the end of the year = Unemployed workers at the beginning of the year + (changes)
= 400 + 500 - 933
= -33
Note that the result is negative. This means that there are fewer unemployed workers at the end of the year than at the beginning, which is a good thing.
However, we need to adjust for the fact that the unemployment rate cannot be negative. To do this, we assume that the number of unemployed workers at the end of the year is zero. This means that all the new workers who entered the labor force found jobs, and all the workers who lost jobs or voluntarily left the labor force were not seeking employment.
Adjusted ending labor force = Ending labor force - number of unemployed workers
= 11003 - 33
= 10970
Unemployment rate = number of unemployed workers / adjusted ending labor force
= 0 / 10970
= 0% (rounded to one decimal place)
Therefore, the unemployment rate at the end of the year in Economica will be 0%.
3 answers