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Brilliant_brown [7]
3 years ago
10

The FOMC believed in November 1994 that the target rate of unemployment was 6.25%. Given the official civilian unemployment rate

of 5.6% at that point in time, what type of unemployment did the FOMC believe existed in the U.S. economy at that point in time?
Business
1 answer:
zmey [24]3 years ago
3 0

Answer:

The type of unemployment that FOMC believe existed at that point in time is FRICTIONAL UNEMPLOYMENT. This is because people were trying to change jobs in search for better payments or a job that more precisely matches their skills, or because of a change in locale or family situation.

Frictional unemployment and other types of unemployment are explained below.

Explanation:

Frictional Unemployment

Frictional unemployment is always present in the economy. It comes from temporary transitions that workers make when moving from job to job looking for better pay or a job that more precisely matches their skills, or because of a change in locale or family situation. It is also a reflection of new or returning workers into the labor force (e.g., graduating college students or empty nesters rejoining the marketplace).

Frictional unemployment may also be the result of employers refraining from hiring or laying off workers for reasons unrelated to the economy.

Structural Unemployment

Structural unemployment is created when there is a mismatch in the demographic or industrial composition of a local economy. For example, structural unemployment can be high in a place where there are technically advanced jobs available but the workers in that area lack the skills to perform them, or conversely, in a locale where there are workers available but no jobs for them to fill.

Advances in new technologies can cause a decline in older industries, which then must shed workers to stay competitive. One example is the U.S. newspaper industry. Many newspaper reporters, editors and production workers have lost their jobs over the past decade as web-based advertising eclipsed newspapers’ traditional sources of revenue and circulation waned as more consumers got their news from television and the Internet. Laid-off journalists, printers, deliverers, etc., all increased the structural unemployment numbers.

Another example is small family farmers, whose farms cannot match the economic power of wealthy agri-businesses. Scores of farmers left the land and entered the workforce. When they fail to find jobs, they add to the structural unemployment statistics, as do factory workers whose employers have moved operations to low-wage countries.

Cyclical Unemployment

Cyclical unemployment occurs when there is not enough demand for goods and services in the economy at large to provide jobs for everyone who wants one. According to Keynesian economics, it is a natural result of the boom and bust business cycles implicit in the nature of capitalism. When businesses contract during a recessionary cycle, workers are let go and unemployment rises.

When unemployed consumers have less money to spend on goods and services, businesses must contract even further, causing more layoffs and more unemployment. The cycle continues to spiral downward unless and until the situation is improved by outside forces, particularly government intervention of some kind.

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Commercial banks create money throughmaking loans. facilitating borrowing from the Federal Reserve to the public. printing treas
Butoxors [25]

Answer:

making loans

Explanation:

Commercial bank is the bank where the most of the people do their banking. Here the money is to be provided and the interest is also earned from such loans like mortgage, auto loans, business loans, personal loans, etc

Therefore as per the given situation, the commercial bank would earned by the money by providing the loans or making the loans

Hence, the first option is correct

7 0
3 years ago
A homeowner paid $85,000 for a house three years ago. The house sells today for $110,000. How much has the property appreciated?
Dima020 [189]

Answer:

Option (a) is correct.

Explanation:

Amount paid for house three years ago = $85,000

Selling price of house today = $110,000

Therefore,

Property appreciated by following percentage:

= (change in value ÷ Amount paid for house three years ago) × 100

= [($110,000 - $85,000) ÷ $85,000] × 100

= ($25,000 ÷ $85,000) × 100

= 0.2941 × 100

= 29.41%

6 0
3 years ago
Provider ______ is the difference between company understanding of customer expectations and the development of customer-driven
wolverine [178]

Answer: Gap 1

Explanation:

The Gap model is used to better understand the problems involved in delivering superior services to customers which can then be overcome for better customer service.

There are 4 gaps and the relevant one here is Gap 1 which is the Listening Gap. Gap 1 is the difference between company understanding of customer expectations and the development of customer-driven service designs and standards.

This Gap is very important to note because the company cannot deliver to its customers effectively if it does not understand what they want in the first place.

7 0
3 years ago
Statement Price Control Binding or Not The government prohibits donut shops from selling donuts for more than $1.80 each.Price c
WINSTONCH [101]

Answer:

The question is incomplete

Explanation:

Price ceiling is a legal maximum on the price at which a good can be sold whereas a price floor is a legal minimum on the price at which a good can be sold

5 0
3 years ago
On January 1, 2021, the Highlands Company began construction on a new manufacturing facility for its own use. The building was c
deff fn [24]

Answer:

$291,000

Explanation:

First, we need to calculate the weighted average expenditure. the Weighted average expenditure is calculated and attached with the answer in PDF format please find it.

Now calculate the Average interest rate on General debt

Average interest rate on General debt = [ ( $7,000,000 x 14% ) + ( $3,000,000 x 9% ) ] / ( $7,000,000 + $3,000,000 ) = [ $980,000 + $270,000 ] / $10,000,000 = $1,250,000 / $10,000,000 = 0.125 = 12.5%

Now the specific loan of $2,350,000 is utilised and the remianing value of expenditure is $636,000 ($2,986,000 - $2,350,000) fromgeneral debt is utilized for the costruction purpose. The interest on both loan should be capitalised.

Interest capitalized = ( $2,350,000 x 9% ) + ( $636,000 x 12.5% ) = $211,500 + $79,500 = $291,000

Download pdf
8 0
3 years ago
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