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According to Okun's law, if output grew 7% and full-employment output rose 5%, what would be the change in the unemployment rate

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Answer:

the change would be 2% of course

The change in the unemployment rate is -1%.

Given to us:

output grew = 7%

full-employment output grew = ΔY = 5%

According to Okun's law,

employment output - 2 (change in the unemployment rate) = output grew

5% - 2(Δu) = 7%

- 2(Δu) = 7% - 5%

- 2(Δu) = 2%

[tex]\bold {\Delta u = \frac{2\%}{-2} }[/tex]

[tex]\bold{\Delta u = -1\%}}[/tex]

Hence, the change in the unemployment rate is -1%.

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https://brainly.com/question/3129560

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