employed in the economy, either full time or part
actively looking for work but aren’t currently
is in the labor force. Equation is labor force/population age 16 and older X 100
is the number of people who work part time because they cannot find full-time jobs.
Workers who spend time looking for employment
are engaged in
a government-mandated floor on the price of labor.
can often win higher wages from employers than the market would have otherwise provided when workers bargained individually.
wages that employers set above the equilibrium wage rate as an incentive for better performance.
public policies designed to help workers who lose their jobs; these policies can lead to structural unemployment as an unintended side effect.
is the normal unemployment rate around which the actual unemployment rate fluctuates. It is the unemployment rate that arises from the effects of frictional plus structural unemployment.
is a deviation in the actual rate of unemployment from the natural rate.
Natural unemployment = Frictional unemployment
+ Structural unemployment
Actual unemployment = Natural unemployment +
is the wage rate divided by the price level.
is income divided by the price level.
are the increased costs of transactions caused by inflation.
is the real cost of changing a listed price
arise from the way inflation makes money a less reliable unit of measurement.
is the interest rate expressed in dollar terms.
is the nominal interest rate minus the rate of inflation.
is the process of bringing the inflation rate down.