Fill This Form To Receive Instant Help
Fill This Form To Receive Instant Help
Homework answers / question archive / If the average worker produces $100,000 of GDP, by how much will GDP change if there are 150 million labor force participants and the unemployment rate changes from 6
If the average worker produces $100,000 of GDP, by how much will GDP change if there are 150 million labor force participants and the unemployment rate changes from 6.0 to 5.5 percent?
GDP will increase
by ??? billion
Labor force in the economy= 150 million
Unemployment rate= 6%
No. of unemployed= 150 million* 6%
= 9 million
Now, Unemployment rate= 5.5%
No. of unemployed= 150 million* 5.5%
= 8.25 million
Decrease in no. of unemployed people= 9 million- 8.25 million
= 750000 people
Increase in GDP= Production of average worker* Newly employed person
= 100000* 750000
= 75 billion
