Suppose the probability of a worker losing his or her job


Suppose the probability of a worker losing his or her job in a year is 2%. The probabil- ity of someone unemployed ?nding a job within a year is 40%. What is the equilibrium un- employment rate? What happens if the government takes measures to free up the labor market that will double the chances the unemployed have of ?nding a job and also double the chances of those with jobs becoming unemployed?

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Microeconomics: Suppose the probability of a worker losing his or her job
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