1. Suppose you live in a community of 100 people where everyone is able and seeks to work. If 75 people are over 16 years old and 50 of them are employed.
2. (a) Calculate the unemployment rate in this community? (b) what is the labor force participation rate?

3. What are the three major types of unemployment? What are their causes?

4. Discuss the costs associated with high inflation.

5. (a) What is the business cycle?

(b)Explain what is happening during

each phase of the cycle with:

I. output

II. employment

II. and inflation