Question: In this chapter we saw that the steady-state rate of unemployment is U/L = s/(s + f). Suppose that the unemployment rate does not begin

In this chapter we saw that the steady-state rate of unemployment is U/L = s/(s + f). Suppose that the unemployment rate does not begin at this level. Show that unemployment will evolve over time and reach this steady state.

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To show that the unemployment rate evolves over time to the steadystate rate lets begin by defining ... View full answer

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