About the unemployment and participation rate

Assignment Help Microeconomics

Reference no: EM13698201

a) Suppose that the matching function is given by: M = em(Q, A) = eQ^(0.7)A^(0.3) Express pc and pf as functions of e and labor market tightness j.

b) Suppose that z = 1, b = 0.4, e = 0.9 and k = 0.24. Suppose that w = 0.75 Find the unemployment rate in the economy.

c) Suppose that e falls to 0.8. Suppose that w is unchanged. What happened to the unemployment rate, the labor force participation rate and output?

d) Suppose that by law the wage is increased (while keeping all the parameters from part (c) unchanged). What is your prediction about the unemployment and participation rate?

Reference no: EM13698201

Questions Cloud

Most likely to prevent them from using your software : For these reluctant companies, what issue is most likely to prevent them from using your software?

Most likely to result in the most costs savings : From the items below that will no longer be needed, which one is most likely to result in the most costs savings?

Still be needed when you move your company to paymaster : Which of these will still be needed when you move your company to PayMaster?

The price of oranges has risen dramatically : The price of oranges has risen dramatically. Which of the following is likely to happen?

About the unemployment and participation rate : Suppose that the matching function is given by: M = em(Q, A) = eQ^(0.7)A^(0.3) Express pc and pf as functions of e and labor market tightness j. Suppose that by law the wage is increased (while keeping all the parameters from part (c) unchanged). Wha..

Markets are more efficient when information is perfect : Which of the following is an example of a change in the quantity demanded? (Hint. For which items is there a direct change in price that leads to a change in quantity demanded) Markets are more efficient when information is perfect;

Wealth and housing possibilities after housing prices fall : If I spent all my money ($450,000) on a new house I could buy a house with 4500 square feet. I settle for a 1500 square foot house. (Each square foot costs the same.) The day after I close the deal a nearby nuclear power plant is condemned and the va..

Difference between a monopsonist and a monopolist : The difference between a monopsonist and a monopolist is that

What is the annual equivalent life-cycle cost of gas turbine : A 50-kilowatt gas turbine has in investment cost of $40,000. It costs another $14,000 for shipping, insurance, site preparation, fuel lines, and fuel storage tanks. The operation and maintenance expense for this turbine is $450 per year.

User Account

All Pages