Labor Shortage, Unemployment Types, Natural Unemployment Rate, and Inflation

University:
California State University, Northridge
Course:
ECON 160 | Principles of Microeconomics
Academic year:

2023
Views:

165

Pages:

2
Author:

Mahmoud M.

Microeconomics notes Labor shortage: Unemployment rate includes unemployed or irregular workers Healthy and unhealthy types of unemployment: - Temporary unemployment: job seeking, healthy economic change, no problem - Poor unemployment: Skills development for workers Aging, conflict among workers skilled workforce, Economic fluctuations are healthy - Seasonal unemployment: ● Healthy, no problem - Cyclic unemployment: ● Unhealthy for economic change, problems must be addressed Natural Unemployment Rate: Full Natural Unemployment Rate: - Frictional, Seasonal and Full Employment including Structural Unemployment - Zero Cyclic Unemployment Rate Relationship between Natural Unemployment Rate and Potential GDP: - Unemployment rate = real GDP4; full time job Inflation: Changes in consumer spending that pose a risk to capital markets will lead to a vicious circle of further inflation . ● increase the average price and decrease the value of money - pay more for some goods - Your money has no value ● Consumer Price Index - Average price of durable goods and services Inflation is a concern as price falls Quantity Income affects interest rates - Nominal Ratios Observed Ratios - Real Ratios: Nominal Ratios Adjusted for Inflation Nominal Ratios - Inflation Rates Deflation: Average Prices Fall and Money Values 4 Consumers 4 Deflation 4 ● good for savers, bad for borrowers