Question: QUESTION 3: (4 marks) Answer the following questions, given the information below on population and the labour market Total population = 95.4 million Working age

QUESTION 3: (4 marks) Answer the following questions, given the information below on population and the labour market Total population = 95.4 million Working age population = 76.3 million People not willing or capable to work = 9.5 million Number of employed = 57.7 million a) Calculate the labour force as well as the unemployment rate. Show your work. (2 marks) b) If the natural rate of unemployment is 8.7%, using the same information above, calculate the cyclical unemployment as well as the forgone output, assuming that the potential GDP is 800 billion (Hint: use the Okun's law). Show your work. (2 marks)

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