Suppose Xenia has a GDP of $20,000,000,000 and a population of 900,000 with a labor force...

Suppose Xenia has a GDP of $20,000,000,000 and a population of 900,000 with a labor force of 600,000. Further suppose that 60,000 people are not working, of which 48,000 are actively seeking employment and 12,000 have given up. Further suppose that the frictional rate of unemployment is 1% and the structural rate is 2%. Please use this info to answer the next six questions

30. The UE rate in Xenia is ______.

31. The cyclical rate of unemployment is ______.

32. The number of people who are structurally unemployed is _______.

33. The number of people who are frictionally unemployed is _____.

34. The economic cost of UE in Xenia is _____.

Now suppose that all of those who had "given up" resume their job-search activity. In the immediate aftermath of this development:

35. Now the UE rate in Xenia is _____.

36. Now the number of people who are frictionally unemployed is ____.

Expert Solution

Rahul Sunny answered 1 year ago

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