The population remains unchanged.

Assignment Purposes/Learning Outcomes:

After completion of Assignment-3 students will able to understand the

LO 1.2: Describe how to evaluate macroeconomic conditions such as unemployment, inflation, and growth.

LO 1.3: Recognize the fundamental determinant’s of a nation’s long-run economic growth.

Assignment 3 Questions: Week 10 to Week 13: – 

Q1: You take $1000 that you held as currency and put it into the banking system. The reserve ratio is equal to 10%.

• Calculate the money multiplier. 
• By how much will increase the total amount of deposits in the banking system? 
• By how much will increase the money supply? 

Q2. (Labor Force, Labor Participation Rate and Unemployment Rate). 

• In Year 1, country A has a labor force of 100, of whom 90 are employed. The remaining 50 people in the country are not in the labor force. 
• Fill in the following table. (Hint: It might be helpful to draw the flow diagram before answering.) 
• Calculate the employment ratio, the labor participation rate and unemployment rate. (Fractions suffice.)

Calculate the employment ratio, the labor participation rate and unemployment rate. 

Over the course of the year, 10% of the employed become unemployed, while 20% of the unemployed become employed; 5% of the employed leave the labor force, while 4% of those not in the labor force become employed. 

The population remains unchanged.