Question

Suppose there are 2,000 people who are unemployed as a result of cyclical unemployment and 1,000 people who are unemployed as a result of structural unemployment. How many people are unemployed as a result of frictional unemployment?

Answer 1

Answer:

1,000

Explanation:

Suppose the town of Boone has a total population of 50,000 people. Of those, 45,000 people are employed. There are 1,000 full-time students who are not employed or actively seeking work. The rest of the people are out of work but have been actively seeking work within the past four weeks.

This information is not given in the question.

For computing the frictional unemployment, first we have to determine the unemployed which is shown below:

Number of unemployed would be

= Total population - employed - full time students

= 50,000 - 45,000 - 1,000

= 4,000

Now the frictional unemployment would be

=  Unemployed - cyclical unemployment - structural unemployment

= 4,000 - 2,000 - 1,000

= 1,000