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Chapter 19: Q 17. (page 471)

What are the two types of unemployment

problems?

Short Answer

Expert verified

Two types of unemployment

problems are Unemployment during a recession and the natural rate of unemployment.

Step by step solution

01

Step 1. Define unemployment.

Unemployment is defined as people who are employable and actively seeking job but are unable to do so.

02

Step 2. Two types of unemploymentproblems.

Two types of unemployment

problems are Unemployment during a recession and the natural rate of unemployment.

During a recession, unemployment tends to grow quickly and stay high for a long time. As a result of greater costs, stagnant or declining revenue, and increased pressure to cover debts, businesses lay off workers to save money.

The natural rate of unemployment is the rate of unemployment that would exist in a healthy, developing economy.

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Most popular questions from this chapter

Use the Rule of 72 to estimate how long it will take for India, Spain, and South Africa to double their standards of living.

What other factors, aside from labor productivity, capital investment, and technology, impact the economic

growth of a country? How?

Retrieve the unemployment data from The World Bank database (http://databank.worldbank.org/data/ home.aspx) for India, Spain, and South Africa for 2011-2015. Prepare a chart that compares India, Spain, and South Africa based on the data. Describe the key differences between the countries. Rank these countries as high-, medium-, and low-income countries. Explain what is surprising or expected about this data. How did the Great Recession impact these countries?

Using the data in Table 19.3, rank the seven regions of the world according to GDP and then according to GDP per capita

Region
Population (in millions)
GDP Per Capita
GDP = Population × Per Capita GDP (in millions)
East Asia and Pacific2,006\(5,536\)10,450,032
South Asia1,671\(1,482\)2,288,812

Sub-Saharan Africa936.1\(1,657\)1,287,650

Latin America and Caribbean588\(9,536\)5,339,390

Middle East and North Africa345.4\(3,456\)1,541,900

Europe and Central Asia272.2\(7,118\)1,862,384

Table 19.3 GDP and Population of Seven Regions of the World

Is inflation likely to be a severe problem for at least some high-income economies in the near future?
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