Suppose population increases by

$3$

$\%$

$,$

$$labor force increases by

$2$

$\%$

$,$

$$number

of unemployed persons increases by

$4$

$\%$

$,$

$$Compute the percentage changes

in the labor force participation and unemployment rates.

$4$

$.$

$$Suppose in an economy the production has constant return to scale. Also

marginal propensity to consume

$($

MP C

$)$

$$is

$0$

$.$

$7$

$$and MPK

$=$

$1$

$5$

$$and

MP L

$=$

$1$

$0$

$.$

$$What is impact on private saving, public saving and national saving when the government increase taxation by

$2$

$0$

$0$

$$and increase

expenditure by

$2$

$5$

$0$

$,$

$$together with an employment of additional

$1$

$5$

$$workers

and a fall of capital investment by

$3$

$0$

$$units$?.$