Reference no: EM131737240
Question: (A) How is full employment defined, and why does the full-employment rate of unemployment keep changing?
(B) In December 1998, the BLS reported the following unemployment rates:
1. Unemployed over 15 weeks 1.1%
2. Job losers 2.0%
3. ‘‘Official'' unemployment rate 4.3%
4. Plus discouraged workers 4.5%
5. Plus marginal workers 5.2%
6. Plus part-time workers 7.5%
Which do you think is the best measure of actual unemployment? Explain your choice.
(C) In 1990, most economists thought the full-employment rate of unemployment was about 6%, but in 2000 they thought it was about 4%. Were they wrong in 1990, or was this change based on economic factors? If so, what factors caused them to change their opinion?
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