Use the table below to answer the following questions:

Labor Force of an Economy

Labor ForceNumber of People (millions)Employed 148.5

Structurally unemployed 4.4

Cyclically unemployed 4.5

Frictionally unemployed. 2.5

Instructions:Round your answers totwo decimal places.

a. Calculate the actual unemployment rate and the natural rate of unemployment for this economy.

Actual rate of unemployment:___%

Natural rate of unemployment:___%

b. Now assume 1.3 million employed workers become [a(18)] unemployed, while 0.3 million [a(19)] unemployed workers find work. Calculate the unemployment rate and the natural rate of unemployment for this economy.

Actual rate of unemployment:___%

Natural rate of unemployment:____%