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Unemployment: Unemployment is the state of an individual looking for a paying job
but not having one. Unemployment does not include full-time students, the retired,
children, or those not actively looking for a paying job.
Types of Unemployment:
Frictional unemployment: Frictional unemployment is unemployment that comes
from people moving between jobs, careers, and locations.
Cyclical unemployment: Cyclical unemployment occurs when the unemployment
rate moves in the opposite direction as the GDP growth rate. So when GDP growth is small
(or negative) unemployment is high.
Structural unemployment: Structural unemployment is an unemployment that
comes from there being an absence of demand for the workers that are available.
Inflation: Inflation is an increase in the price of a basket of goods and services that is
representative of the economy as a whole.
Gross Domestic Product: GDP is Gross domestic product. For a region, the GDP is
"the market value of all the goods and services produced by labor and property located in"
the region, usually a country. It equals GNP minus the net inflow of labor and property
incomes from abroad.
GDP gap: The GDP gap or the output gap is the difference between actual GDP and
potential GDP or potential output. The calculation for the output gap is Y-Y* where Y is
actual output and Y* is potential output or the natural level of output. If this calculation
yields a positive number it is called an expansionary gap and indicates an economy in
expansion; if the calculation yields a negative number it is called a recessionary gap and
indicates an economy in recession.
Okun's law : Okun’s low is one of the most enduring stylistic facts in macroeconomics.
It is one of the basic rules of thumb of macroeconomics. As originally formulated for US
by Arthur Okun in 1962, it states “ in post-war period, on the average, each extra
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percentage point in the unemployment rate above four percent has been associated with
about a three percent decrement in real GDP.
In economics, Okun's law is an empirically observed relationship relating unemployment
to losses in a country's production. The "gap version" states that for every 1% increase in
the unemployment rate, a country's GDP will be an additional roughly 2% lower than its
potential GDP. The "difference version" describes the relationship between quarterly
changes in unemployment and quarterly changes in real GDP. The accuracy of the law has
been disputed.
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UNEMPLOYEMENT RATE
OF
INDONESHIA
YEAR GDP UNEMPLOYEMENT
RATE2004 257 million 9.2%2005 285.9 million 11.8%2006 364 million 12.5%2007 432.1 million 9.1%2008 511.8 million 8.4%
1. In the year 2004 the actual GDP was 257 and unemployment rate is
9.20%
So,
If the actual GDP is 81.6 then potential GDP is 100
If ″ ″ ″ ″ 1 ″ ″ ″ ″ =6.81
100
If ″ ″ ″ ″ 257 ″ ″ ″ ″ =
6.81
257100×
= 314.95
million
2. In the year 2005 the actual GDP was 285.9 and unemployment rate is 11.80%
= 374.22 million
3. In the year 2006 the actual GDP was 364 and unemployment rate is 12.50%
= 485.33 million
4. In the year the 2007 the actual GDP was 432.1 and unemployment rate is 9.10%
= 528.24 million
5. In the year the 2008 the actual GDP was 511.8 and unemployment rate is 8.40%
= 615.14 million
REFERANCE:
Source:
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1. http://www.immigration
usa.com/wfb2004/rankings/economy/unemployment_rate_2004_0.html
2. http://www.nationmaster.com/graph/lab_une_rat-labor-unemployment-rate&date=2005
3. http://www.photius.com/rankings/economy/unemployment_rate_2005_0.html
4. http://www.photius.com/rankings/economy/unemployment_rate_2006_0.html
5. http://www.photius.com/rankings/economy/unemployment_rate_2007_1.html
6. http://www.indexmundi.com/indonesia/unemployment_rate.html.
7. http://www.indexmundi.com/bangladesh/unemployment_rate.html