Time period between jobs when a worker is searching for or transitioning from one place of labour to another.
15
What is structural unemployment?
Lack of demand for workers of specific type of labour
15
What two types of unemployment will always exist?
Frictional and structural
15
What happens to unemployment when the GDP is high?
The unemployment rate decreases
10
Why are cheap prices bad for the economy?
Because this situation discourages people from spending, due to the expectation of lower prices. This makes the prices rise even more; GDP decr, unempl incr.
20
Name 4 components of the GDP.
Consumer spending, business spending, government spending, net exports.
20
Is cruise control for the economy a good idea?
Well, it depends. Some say yes, others - no. If the country is in a recession, the govern can increase spending or cut taxes; cruise control won't be beneficial
20
What does higher GDP lead to?
Full capacity of production to keep up with the demands => inflation => people asking for higher wages => economy slows down.
