Question

a) In not less than 200 words, analyse the impact of coronavirus outbreak on i.) the natural rate of unemployment in Hong Kong and ii.) the cyclical unemployment in Hong Kong.

Answer 1

The natural rate of unemployment = frictional + structural unemployment

This denote expanding, persisting and efficient economy as well as labor and resources supply and demand equilibrium.

Hongkong is important for china due to investment destination and share ,stock market and other industrial activities etc hub.

But due to covid -19 out break industrial and construction manufacturing etc. are stopped or working at lower pace which mismatch equilibrium in the economy of China in the form of labor supply , resources supply, investment outfolw and development activities in the economy. Thus it affected the natural rate of unemployment in the economy and increase frictional unemployment (quitting of jobs, rest from job for a while and transfer from one activities to other in security of job) for a short of while ,and affected cyclical unemployment.

Cyclical unemployment

,overall demand for goods and services in an economy of any country is not able to fullfill full employment level. Its is happening in china right now because slow down in the economy due to covid-19 out break, which slow down every sector of economy for a while and thus may result in cyclical unemployment increase in upcoming days as well as right now. Because demand for good and service is still high compare to production activities or employment generation in the economy of china due slowing economic activities. F