The Bureau of Labor Statistics does not count discouraged workers as unemployed. Suppose discouraged workers were counted as unemployed. Explain how the unemployment rate and the labor force participation rate would change
What will be an ideal response?
Both the unemployment rate and the labor force participation rate would increase. The number of unemployed would rise, as would the labor force. The unemployment rate would rise because adding the same number to the numerator and the denominator of a fraction that is less than one increases the value of the fraction. The labor force participation rate would rise because the labor force increases with no change in the working-age population.
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Explain Tobin's idea of "Don't put all your eggs in one basket."
What will be an ideal response?
If a macroeconomist studying the causes of unemployment finds that, historically, changes in technology seem to have caused between five and 15 percent of changes in unemployment, then this macroeconomist is at which step in the process of developing
an economic model? A) Identify the exogenous variables. B) Identify the endogenous variables. C) Develop a model. D) Compare the model with the data. E) Conduct prediction and policy analysis.
The primary criterion used to analyze the desirability of outcomes in Economics is
a. sustainability b. equity. c. predictability. d. efficiency.
The forward exchange market:
a. Is the market for current delivery. b. Is the market for current deliveries but future payments. c. Handles transactions for individuals or companies who would like to reduce foreign exchange risk by locking in exchange rates now. d. Is a market with no default risk. e. Provides sufficient liquidity for any maturity and amount.