Question

What are the four phases of the business cycle?

Which phase of the business cycle would be the best time to purchase a large ticket item?

How do you calculate the labor force participation rate?

Who is accounted for in our country’s labor force?

How is our country’s unemployment rate calculated?

In one to two sentences, please define the term, “full employment?”

In one to two sentences, what is a discouraged worker?

What are the four types of unemployment?

Which type of unemployment is the direct cause of our country (economy) contracting?

In one to two sentences, please define, inflation?

Answer 1

(1) the four phases of business cycle are Prosperity, Recession, Depression and Recovery.

(2) the business cycle phase which is the best time to purchase a large ticket item like a car or gadget or electric appliance is during expansion of the economy which is prosperity or Boom phase when both profits and wages are on a rising trend leading consumers to borrow and have positive expectations.

(3) Labor force participation rate is the proportion of labor force which is employed. It is calculated as the ratio of number of employed labor upon total labor force.

(4) Labor force accounts for all those people who are in the working age group (18-65) and are either employed or looking for employment.

(5) Country's unemployment rate is the fraction of number of unemployed divided by total laborforce.

(6) Full employment is a level of output where a market utilizes its full potential or all the resources are employed to their full use and there is no better output level in the long run.

(7)discouraged worker represents those unemployed labor which have the required skills for a job but do not get employed because they are discouraged by some or the other factors. for example under paid, no social security etc.

(8)four types of unemployment are Frictional, Seasonal, Cyclical and Structural unemployment.

(9) Structural unemployment leads to country's contraction of the economy.

(10) Inflation is when the overall price level in an economy blows up or inflates. It is calculated as the rate of growth of price level with respect to some base year as reference.

(4)