Sage-Tips

How is it possible that both employment and unemployment both increased?

It is possible that both employment and unemployment increased because of the increase of the Labour Force population. Consistent with a balanced labour market and a stable rate of inflation.

Can we have both full employment and unemployment at the same time?

Full employment is a situation in which there is no cyclical or deficient-demand unemployment. An economy with full employment might also have unemployment or underemployment where part-time workers cannot find jobs appropriate to their skill level, as such unemployment is considered structural rather than cyclical.

Is it possible for the unemployment rate to go down while the number of unemployed workers increases?

Although a clear reason is a change in the number of job seekers, the unemployment rate may also be affected by a change in the size of the labor force.

What two factors should you equate in deciding how many workers to employ?

What two factors should you equate in deciding how many workers to employ? if w > MPN, the cost (w) of hiring additional workers exceeds the benefits (MPN) of hiring them, so they should hire fewer workers. marginal product of labor is less than the real wage rate.

Can the unemployment rate rise even though total output is rising?

Yes, if employment rises faster than output. With falling average productivity, the labor force increases, and unemplyment increases faster than employment. c. With constant average productivity, the labor force increases, but unemployment increases more slowly than employment.

What unemployment rate is considered full employment?

Many consider a 4\% to 5\% unemployment rate to be full employment and not particularly concerning. The natural rate of unemployment represents the lowest unemployment rate whereby inflation is stable or the unemployment rate that exists with non-accelerating inflation.

How is full employment related to the unemployment rate?

To economists, full employment means that unemployment has fallen to the lowest possible level that won’t cause inflation. In the U.S., that was once thought to be a jobless rate of about 5 percent.

Does full employment mean zero unemployment?

Explanation: Full employment is defined as a situation where there is no involuntary unemployment and all resources are fully and efficiently employed at the existing wage rate. Thus full employment does not mean zero unemployment due to the existence of voluntary, structural and frictional unemployment.

What are the causes for increasing unemployment in India explain?

Unemployment and underemployment in India are caused by more basic structural factors such as lack of capital, use of capital-intensive technologies, lack of access to land for agricultural household, lack of infrastructure, rapid growth of population resulting in large annual increments in labour force year after year …

What determines the unemployment rate?

In general, the unemployment rate in the United States is obtained by dividing the number of unemployed persons by the number of persons in the labor force (employed or unemployed) and multiplying that figure by 100.