3.4 (Pt. 1) - Unemployment Levels

Question 1

What defines an unemployed person (ANAI)?

Answer 1

An unemployed person must have these characteristics:
- Aged 15+ years
- Not employed
- Actively seeking work
- Is available to start work

Question 2

What is the ‘Labour Force?’

Answer 2

The labour force counts all the 15+ year olds, whether employed or unemployed, who have the time to and are happy to work.

Question 3

What is the formula to calculate Unemployment Rate?

Answer 3

Unemployment Rate = (Unemployed/Labour Force) * 100

Question 4

What does unemployment affect?

Answer 4

Unemployment affects the level of wages paid, and therefore, affects consumer spending, economic growth, and the standard of living.

Question 5

What happens when pay increases (CEL)?

Answer 5

When pay increases:
- Consumer spending increases
- Economic growth increases
- Living standard increases

Question 6

What are the first three costs of high unemployment levels (IGI)?

Answer 6

The first three costs are:
- Income tax revenue falls
- Government expenses rise
- Increase rates of crime, family breakdown and regional decay

Question 7

What are the last two costs of high unemployment levels (WI)?

Answer 7

The last two costs are:
- Wasted labour resources
- Individual costs