Instructions: Please answer questions 1-4, and follow the grading rubrics when a

Question

Instructions: Please answer questions 1-4, and follow the grading rubrics when answering each question.

Grading Rubrics

a. Define the term(s)

b. Offer an example to further illustrate your idea

c. Next, explain and state your conclusion. Have you answered the question(s)

d. Try to relate the concept to previous work/assignment(s)

Question 1

What is the difference(s), if any, between the unemployment rate and the natural rate of unemployment? Discuss.

Question 2

The expenditure approach (the sum of all spendings) to measuring the value of the nation's output (GDP) is equivalent to the income approach (the sum of all payments to factors). Discuss and illustrate with examples(s) where necessary.

Question 3

Real GDP is the same as nominal GDP? If yes, why? If no, why? Discuss

Question 4.

Does GDP provide an accurate measure of the well-being of the population in a country? Yes or No. Discuss and offer examples where necessary.

Explanation / Answer

Question 1. Unemployment rate refers to the percentage of the labor force who are out of work and who are actively seeking employment. The natural rate of unemployment is the minimum level of unemployment that must be there in an economy. The natural level of unemployment happens when the economy is in long-term equilibrium.

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