a)Why is the number of unemployed lower than the number of people available to work?(4 marks)

b)Assume wage negotiations are done and agreed based on the CPI. Briefly explain what happens to employers and employees when the CPI is downwardly biased (i.e. the CPI is estimated to be lower than what it should be).(4 marks)

c)Briefly discuss why an activity with no market price does not count as part of GDP? Provide an example of such a situation(5 marks)