Topic 2.3 Unemployment Part A: Unemployment Calculations . Who makes up the labor force? 2. What is the formula for the unemployment rate? (Table A) Employed Unemployed Civilian Population Country A 400 thousand 200 thousand 1 million Country B 9 million 1 million 20 million 3. Using the data from the table above, calculate the unemployment rate for country A and country B. Show your work. Calculation A: Calculation B: 4. What is the formula for the labor force participation rate? 5. Using the data from table A above, calculate the labor force participation rate for country A and country B. Show your work. Calculation A: Calculation B: 6. When unemployed workers become discouraged workers, what happens to the unemployment rate? Explain. 7. When unemployed workers find part-time work, what happens to the unemployment rate? Explain.Part B Types of Unemployment 8. In your own words, define the three main types of unemployment. Frictional: Structural: Cyclical: 9. Place an "X" in the appropriate column to identify the type of unemployment described. Frictional Structural Cyclical A high school senior looking for her first job. A worker becomes unemployed because his factory is automated. A restaurant employee is fired for chronic tardiness. A financial crisis leads to widespread lay-offs across the economy. A laid off worker has trouble finding a job because the jobs available require more education. 10. In your own words, define the natural rate of unemployment.(Table B) Country A Country B Country C Country D Country E Total 6% 10% Unemployment 8% 12% 9% Frictional 2% 4% 5% 6% 3% Structural 3% 2% 1% 5% 4% 11. Using the data from table B above, calculate the natural rate of unemployment for country A, B, and C. Show your work. Country A: Country B: Country C: 12. Using the data from table B above, calculate the rate of cyclical unemployment for country D and E. Show your work. Country D: Country E:Part 1: Identify the different parts of the business cycle using the diagram below. A B Potential Output Actual Output Real Output D Time Write the letter below the appropriate term: Peak Trough Expansion Contraction Recovery Recession Natural Rate of Inflationary Recessionary Long-run Positive GDP Negative GDP Unemployment Gap Gap Equilibrium Gap Gap Part 2: Read the scenario and mark the most likely phase on the business cycle being described with an "X". Peak Trough Expansion Contraction This phase marks the end of a recession This phase can be predicted by an unexpected increase in business inventories When the unemployment rate is increasing When GDP output is decreasing When national income is increasing When unemployment is at its highest When inflation is likely to be at its highest When it's hardest for businesses to find workers