ECO ch 14

  1. Labor Force(LF)
    • number of people employed plus unemployed
    • (LF=E+U)
  2. unemployment rate
    • number of people unemployed as a percentage of the LF
    • unemployment rate = U/LF
  3. Frictional Unemployment
    portion of unemployment that is due to normal working of the labor market, used to denote short-run job/skill matching problems
  4. Structional Unemployment
    portion of unemployment that is due to changes in the structure of the economy that result in significant loss of jobs in certain industries
  5. Cyclical Unemployment
    The increase in unemployment that occurs during recessions and depressions
  6. Labor Demand Curve
    Graph that illustrates the amount of labor that firms want to employ at each given wage rate
  7. Sticky Wages
    The downward rigidity of wages as an explanation for the existence of unemployment.
Card Set
ECO ch 14