Both countries have an overall unemployment rate

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Consider two hypothetical countries. In Country A, 20 percent of the labor force is unemployed for half the year and employed for the other half; the remaining 80 percent of the labor force is never unemployed. In Country B, 100 percent of the labor force is unemployed for 10 percent of the year and employed for the other 90 percent of the year. Note that both countries have an overall unemployment rate of 10 percent.

Reference no: EM13984030

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