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ECON 2350 Lecture Notes - Lecture 28: Competitive Equilibrium, Real Wages

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amberdolphin86
3 Mar 2018
School
York University
Department
Economics
Course
ECON 2350
Professor
Haiping Wang

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Document Summary

Econ 2350 lecture 28 notes the supply side of the labor market: optimization by. Consumers and the demand side of the labor market: optimization by firms. In that instance, the consumer would be counted as unemployed, since he or she has been actively engaged in search, but is not employed. If there are q consumers searching and m successful matches, then for an individual consumer, the probability of finding work is m/q or from the matching function. Equation (6-1), pc = em(q, a) q , (6-3) where pc is the probability of finding work for a consumer: then, given the constant- returns-to-scale property of the matching function, setting x = 1/q in equation (6-2), and defining j k a/q, from equation (6-3) we get pc = em(1, a q ) ) (6-5: recall that p(q) defines the supply curve for the number of consumers choosing to search for work, q.

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Related Questions

QUESTION 41

The consumer price index is intended to measure the cost of all goods purchased in the economy over time.

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QUESTION 42

When an economy has reached a zero unemployment rate, it is said to have reached full employment.

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QUESTION 43

The official unemployment rate is a useful but not altogether accurate measure of joblessness.

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QUESTION 44

The two types of reserves are federal reserves and required reserves.

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QUESTION 45

Automatic stabilizers, such as tax revenues and transfer payments, eliminate fluctuations in the business cycle.

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QUESTION 46

When the actual rate of unemployment is equal to the natural rate of unemployment, we conclude that there is no cyclical unemployment.

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QUESTION 47

Increased government regulation can cause the aggregate supply curve to shift to the left.

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QUESTION 48

The price index in the base year is normalized so that it equals 100.

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QUESTION 49

If the Federal Reserve wants to increase the money supply, it should raise the required reserve ratio.

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QUESTION 50

The aggregate supply curve in the long run is vertical because wages and other input prices respond completely to a change in price level.

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QUESTION 51

Public choice analysis helps us to understand why deficits seem inevitable, since we always pay the full costs of government programs today.

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QUESTION 52

Expansionary demand-side fiscal policies set up a tradeoff between increasing output at the expense of raising prices.

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QUESTION 53

Cathy works part-time as a bookkeeper but would like to have a full-time position. She has been actively searching for months but so far has not found a job. According to the Bureau of Labor Statistics, Cathy is unemployed.

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QUESTION 54

The real rate of interest is the nominal rate of interest times the inflation rate.

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QUESTION 55

The time required to comprehend that a recession has in fact begun is called the recognition lag.

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QUESTION 56

If an economy is in long-run equilibrium, it is also in short-run equilibrium.

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QUESTION 57

Policymakers can increase output by enacting policies that expand government spending, consumption, investment, or net exports or reduce taxes.

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QUESTION 58

When Disney builds a new amusement park in the United States, it is counted as part of GDP.

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QUESTION 59

The oil shock of 1973 led to demand-pull inflation.

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QUESTION 60

Casey is a 16-year-old high school student who has no marketable skills. He has been browsing the want-ads in the local newspaper for months but finally got so discouraged that he quit looking. According to the Bureau of Labor Statistics, Casey is unemployed.

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