Questions and Answers
What is the Unemployment Rate Formula?
What is the Employment-Population Ratio Formula?
What is the Labor Force Formula?
What is the formula for Natural Rate of Unemployment?
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What is frictional unemployment?
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What is structural unemployment?
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What is the Cyclical Unemployment Formula?
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What is the Labor Force Participation Rate?
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What is the GDP Deflator formula?
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What is Nominal GDP?
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What is Real GDP?
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What are Net Exports?
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What is the formula for short-run economic growth?
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What is the Inflation Rate formula?
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What is the formula for Real GDP per capita?
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What is the formula for rGDPpc growth rate?
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What is the Long-run economic growth rate formula?
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What is the Population Growth Rate Formula?
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Study Notes
Unemployment Metrics
- Unemployment Rate Formula: Calculated as the number of unemployed divided by the labor force, multiplied by 100.
- Employment-Population Ratio Formula: Defined as the number of employed individuals divided by the working-age population, multiplied by 100.
- Labor Force Formula: The sum of employed and unemployed individuals within the economy.
- Natural Rate of Unemployment Formula: Composed of frictional and structural unemployment rates.
- Cyclical Unemployment Formula: Determined by subtracting the natural unemployment rate from the actual unemployment rate (CU = U - U*).
Types of Unemployment
- Frictional Unemployment: Refers to short-term job searches typically occurring during transitions between jobs.
- Structural Unemployment: Arises from persistent mismatches between the skills of the workforce and the requirements of available jobs, often requiring retraining.
Economic Indicators
- Labor Force Participation Rate: Represents the labor force as a percentage of the working-age population, indicating the overall engagement of people in the labor market.
- GDP Deflator: A measure of price inflation, calculated as nominal GDP divided by real GDP, multiplied by 100.
- Nominal GDP: The economic output measured using current prices in the year of calculation.
- Real GDP: The economic output measured using the prices from a base year, allowing for inflation adjustment.
Trade and Growth Formulas
- Net Exports: Calculated as exports minus imports, influencing the balance of trade.
- Short-Run Economic Growth Formula: The change in real GDP from one year to the next, expressed as a percentage of the previous year's real GDP.
- Inflation Rate: Calculated using either the deflator or the Consumer Price Index (CPI) from the current and previous years, reflecting the rate of price increase in the economy.
- Real GDP per Capita: Represents the real GDP divided by the total population, adjusted for population size.
- Real GDP per Capita Growth Rate: Evaluates individual economic growth by subtracting the population growth rate from the real GDP growth rate.
Long-Run Growth Analysis
- Long-Run Economic Growth Rate: The short-run economic growth rate adjusted for population growth rate influences long-term economic projections.
- Population Growth Rate Formula: Measures changes in population from one year to another, expressed as a percentage of the previous year's population.
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Test your knowledge on key macroeconomic formulas with these flashcards. Each card presents a formula along with its definition, helping you understand concepts such as the unemployment rate and labor force. Perfect for students preparing for exams in economics.