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4 marksUnemployment and Inflation

CAPE Economics Unit 2 · 2018 · Paper 2 · Question 2(c)(iii)

Table 1 provides population and employment data for a hypothetical country across Year 1 and Year 2.

Discuss how it is possible that the number of persons employed increased yet the unemployment rate also increased rather than decreased.

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Other parts of this question

  1. 2(a)Define the term 'frictional unemployment'.[2 marks]
  2. 2(b)State TWO limitations of monetary policy.[2 marks]
  3. 2(c)(i)Calculate the labour force participation rate (to one decimal place) in Year 1 and Year 2.[6 marks]
  4. 2(c)(ii)Calculate the unemployment rate (to one decimal place) for Year 1 and Year 2.[3 marks]
  5. 2(d)Analyse how the money market responds to BOTH a shortage of money and a surplus of money.[8 marks]

More practice: the rest of this paper · more Unemployment and Inflation questions · all CAPE Economics Unit 2 past papers