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(a) At any point in time what are the three possible (mutually ex- clusive) states into which an individual who is a member of the

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(a) At any point in time what are the three possible (mutually ex- clusive) states into which an individual who is a member of the working age population can be classified? (Unemployed, employed and not in the labour force) (b) Consider some period of time (say a month). During that month what are the six possible labour market flows across the three states? (You might find it helpful to draw a diagram). (Unem- ployed to employed, unemployed to not in the labour force, em- ployed to unemployed, employed to not in the labour force, not in the labour force to employed, not in the labour force to unem- played)

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