Question

Review model af Equiibrium 2s% af the labaus the unemplayment fone éxpeuiences unemploment Jeas fox EnLe cL 20 days uagecalulete the Eguilibrium unemplayment lk

Answer 1

Here, 25% of the labor force remain unemployed for every 20 days in 365 days (a year).

Thus, we can make the following table:

Group	Weights	No of days employed
Group 1	75% or 0.75	365
Group 2	25% or 0.25	(365 – 20) = 345

Employment rate: 0.75 * (365/365) + 0.25 * (345/365) = 0.9863

Hence, Unemployment rate: 1 – (employment rate) = 0.0136