1. Number of people employed = 120,500; number of people unemployed = 4050 a. What is the...

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Question:

1. Number of people employed = 120,500; number of people unemployed = 4050

a. What is the number of people in the labor force?

b. What is the unemployment rate?

2. Classify the people described in each of the following scenarios as either frictionally, structurally or cyclically unemployed

a. Phil is currently unemployed because the tire factory where he used to work installed robots which replaced 500 laborers, including Phil.

b. Jessica is unemployed because she is in the process of reentering the labor force after taking time off to have a baby.

c. Mary is unemployed because she lost her job at McDonald’s after the state increased the minimum wage. d. Sandy left her former job at an accounting firm a month ago. She is in the process of interviewing for a similar position at six different accounting firms although she has not accepted a job yet.

3. What do economists mean by the natural rate of unemployment?

5. What can you deduce if the actual rate of unemployment exceeds the natural rate of unemployment.?

6. Samantha invested $2,500 of her savings in a certificate of deposit that pays an annual 4.25% rate of interest. The current annual inflation rate is 5%. Has Samantha made a wise investment from an economic perspective?

7. William wants to earn a real annual interest rate on his investment of at least 7%. If the annual rate of inflation is 4% what is the minimum nominal rate of interest William would be willing to accept on his investment?