Mmacro

Question 1

How many people are in the LFS

Answer 1

40,000

Question 2

What are problems with LFS

Answer 2

40,000 people - sampling size - expensive
Discouraged workers - ones who have given up trying to get a job are economically inactive but not counted as unemployed
Inactive groups - early groups, carers, mothers staying at home
Underemployed - those who barely work but want full time ( in Uk only need to work an hour a week to be counted as employed
Disparities - doesn’t show what groups are unemployed - eg race gender age

Question 3

What are the 2 disequilibrium unemployment

Answer 3

Cyclical (demand deficit) - fall in real gdp and ad leads to less employment (labour is a derived demmand)
Real wage unemployment(classical) - excess supply due to a high wage above equilibrium as a result of mw or trade regulation

Question 4

What are the 3 unemployment in equilibrium

Answer 4

Structural - immobility of labour due to long term change in the structure of an industry
Frictional - in between jobs
Seasonal - depends on temp