Question 1 (25 marks) You have the following information about an economy at the end of October 2022. (a) [5\%] Calculate the total number of the employed, the total number of the unemployed, and the size of the labor force for this economy at the time concerned (round to one decimal point if needed, the same for all calculations below). (b) [5\%] Calculate the unemployment rate (u-rate) and the labor force participation rate (LFPR) of this economy at the time concerned. (c) [5\%] Suppose the u-rate you calculated above is lower than the u-rate at the end of September 2022 . Does it necessarily mean that the situation in the job market is improving? Give at least one reason to support your answer. (d) [5\%] Suppose the government will raise the retirement age from 60 to 65 for men, and you expect the number of jobs (both full-time and part-time) will remain stable. Will the u-rate rise or fall next year due to this change of policy? Explain. (Hint: you need to think about both those entering the labor market and those retiring.) (e) [5\%] Suppose, instead of the policy in (d), the government just started the policy of subsidizing birth-giving, and you do expect that some families will respond to the new policy. How will the new policy affect the u-rate and LFPR in the next couple of years? Explain. Question 1 (25 marks) You have the following information about an economy at the end of October 2022. (a) [5\%] Calculate the total number of the employed, the total number of the unemployed, and the size of the labor force for this economy at the time concerned (round to one decimal point if needed, the same for all calculations below). (b) [5\%] Calculate the unemployment rate (u-rate) and the labor force participation rate (LFPR) of this economy at the time concerned. (c) [5\%] Suppose the u-rate you calculated above is lower than the u-rate at the end of September 2022 . Does it necessarily mean that the situation in the job market is improving? Give at least one reason to support your answer. (d) [5\%] Suppose the government will raise the retirement age from 60 to 65 for men, and you expect the number of jobs (both full-time and part-time) will remain stable. Will the u-rate rise or fall next year due to this change of policy? Explain. (Hint: you need to think about both those entering the labor market and those retiring.) (e) [5\%] Suppose, instead of the policy in (d), the government just started the policy of subsidizing birth-giving, and you do expect that some families will respond to the new policy. How will the new policy affect the u-rate and LFPR in the next couple of years? Explain
