Question

In: Economics

#7a). Classify each of the following cases as frictional, structural, or cyclical unemployment. a) A farmer...

#7a). Classify each of the following cases as frictional, structural, or cyclical unemployment. a) A farmer lost his job because the area he lives in was transformed into a highly industrialized zone. b) Caroline graduated from college and is currently looking for a job c) Eliot works in the automobile industry in Windsor. He lost his job because cheaper imported cars have poured over the border from Japan. d) Paul, who is a restaurant manager, lost his job because of a COVID-19. e) Mrs. Beautiful finished raising her children and decided to look for a job. f) Benedict quit his job because of fear of being exposed to COVID-19, now he is looking for work in a different profession. g) Elizabeth lost her job because the company she used to work in merged with another company. #7b). The information in the following table is for the economy of Tibor: Working-age population 60.0 Number of people in full-time employment 39.5 Number of people in part-time employment 6.1 Number of people unemployed 2.4 Number of discouraged workers 1.6 CPI 112.5 a) What is the unemployment rate? b) What is the participation rate?

Expert Solution

#7a). A farmer lost his job because the area he lives in was transformed into a highly industrialized zone.

This is known as structural unemployment.

b. Caroline graduated from college and is currently looking for a job.

Frictional unemployment.

c. Eliot works in the automobile industry in Windsor. He lost his job because cheaper imported cars have poured over the border from Japan.

Cyclical Unemployment.

d. Paul, who is a restaurant manager, lost his job because of Covid-19.

The job is lost due to economic shock. Thus, this will fall under Cyclical Unemployment.

e. Mrs. Beautiful finished raising her children and decided to look for a job.

Frictional unemployment.

f. Benedict quit his job because of fear of getting exposed to COVID-19, now he is looking for work in a different profession.

Frictional Unemployment.

g. Elizabeth lost her job because the company she used to work in merged with other company.

It can be termed as structural unemployment.

7b). a. Unemployment rate = (no of unemployed/labor force)*100

= (14.9/(43.5+14.9))*100

= (14.9/58.4)*100

= 25.51 percent

b. LFPR = (labor force/Adult population)*100

= (58.4/60)*100

= 97.33 percent

Rahul Sunny answered 8 months ago

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