3. The towns of Sawyer and Thatcher each have a labor force of 1,200 people. In Sawyer, 100 people were unemployed for the entire year, while the rest of the labor force worked continuously. In Thatcher, every member of the labor force was unemployed for 1 month and employed for 11 months. a) What is the average unemployment rate over the year in each of the towns? b) What is the average duration of unemployment spells in each of the towns? c) In which town do you think the costs of unemployment are higher?
3. The towns of Sawyer and Thatcher each have a labor force of 1,200 people. In Sawyer, 100 people were unemployed for the entire year, while the rest of the labor force worked continuously. In Thatcher, every member of the labor force was unemployed for 1 month and employed for 11 months. a) What is the average unemployment rate over the year in each of the towns? b) What is the average duration of unemployment spells in each of the towns? c) In which town do you think the costs of unemployment are higher?
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter20: Unemployment
Section: Chapter Questions
Problem 1PA
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3. The towns of Sawyer and Thatcher each have a labor force of 1,200 people. In Sawyer, 100 people were unemployed for the entire year, while the rest of the labor force worked continuously. In Thatcher, every member of the labor force was unemployed for 1 month and employed for 11 months.
a) What is the average
b) What is the average duration of unemployment spells in each of the towns?
c) In which town do you think the costs of unemployment are higher?
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