The population of a country can be divided into the employed, the unemployed, andthe persons who are out of the labor force (OLF).In any given month, the transition probabilities among the various categories are givenby the following table.Moving intoEmployed Unemployed OLF0.97Moving from: Employed0.020.01Unemployed 0.35OLF0.600.050.020.040.94The transition probabilities are interpreted as follows. In any given month, 2% of theemployed become unemployed, 35% of the unemployed find jobs, and so on.(a) What is the steady state employment rate?(b) What is the steady state unemployment rate?(c) What is the steady state labor force participation rate?

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The population of a country can be divided into the employed, the unemployed, and the persons who are out of the labor force (OLF). In any given month, the transition probabilities among the various categories are given by the following table. Moving into Employed Unemployed OLF Moving from: Employed 0.97 0.02 0.01 Unemployed 0.35 OLF 0.60 0.05 0.02 0.04 0.94 The transition probabilities are interpreted as follows. In any given month, 2% of the employed become unemployed, 35% of the unemployed find jobs, and so on. (a) What is the steady state employment rate? (b) What is the steady state unemployment rate? (c) What is the steady state labor force participation rate?

The population of a country can be divided into the employed, the unemployed, and the persons who are out of the labor force (OLF). In any given month, the transition probabilities among the various categories are given by the following table. Moving into Employed Unemployed OLF Moving from: Employed 0.97 0.02 0.01 Unemployed 0.35 OLF 0.60 0.05 0.02 0.04 0.94 The transition probabilities are interpreted as follows. In any given month, 2% of the employed become unemployed, 35% of the unemployed find jobs, and so on. (a) What is the steady state employment rate? (b) What is the steady state unemployment rate? (c) What is the steady state labor force participation rate?

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter28: Unemployment

Section28.1: Ldentifyinr Unemployment

Problem 1QQ

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