An economy currently has a separation rate 3 = 5% and a job-finding rate f = 74%. Suppose the government adopts new rules to protect jobs. The result is a decrease in the separation rate 5 from 5% to 6% in the bathtub model of employment. If the government wants to maintain the same natural rate of unemployment, it must adopt additional labor market policies with a job-finding rate of %. Round your answer to the nearest tenth of a percent.

An economy currently has a separation rate 3 = 5% and a job-finding rate f = 74%. Suppose the government adopts new rules to protect jobs. The result is a decrease in the separation rate 5 from 5% to 6% in the bathtub model of employment. If the government wants to maintain the same natural rate of unemployment, it must adopt additional labor market policies with a job-finding rate of %. Round your answer to the nearest tenth of a percent.

Macroeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506756

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter8: Economic Fluctuations, Unemployment, And Inflation

Section: Chapter Questions

Problem 5CQ

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