Question

• Each month, ​
• 1% of employed workers lose their jobs (s = 0.01)​
• 19% of unemployed workers find jobs (f = 0.19)​
• Find the natural rate of unemployment:

Answer 1

$\frac{U}{L}=\frac{s}{s+f}=\frac{0.01}{0.01+0.19}=0.05, or$ $5\%$