2020-21Mr. Marynovskyy



Chapter 9Teaching TipsThe GDP DeflatorIn the past decade Statistics Canada has refined its method for calculating real GDP. Its former method, explained in Figure 9.3 of the text, stresses reference-year prices in weighting the outputs of various products. The reason for Statistics Canada's switch is that this method creates the potential for bias over time, especially when there is a range of price changes, with some prices rising much more than others. Recall that, based on Figure 9.3, quantities of individual products appearing in GDP are valued both at current-year and reference-year prices. The total valuation in current-year prices is divided by the total valuation in reference-year prices to give the relevant value of the GDP deflator. For example, if 2014 is the reference year, the GDP deflator in 2014 equals 100. For 2015, the calculation results in a ratio, with individual quantities for 2015 appearing both in the numerator and denominator. In the numerator, these quantities are valued at 2015 prices, and in the denominator at 2014 prices. Once the GDP deflator is derived, real GDP is found through the basic formula:Real GDP = nominal GDP / GDP deflator (in hundredths)Note the role played by prices from the reference year in these calculations. As long as relative prices in the economy stay approximately the same, using reference-year prices to weight quantities in the denominators of each of the GDP deflator ratios is not a significant problem. But if some prices change far more rapidly than others, or if some prices are even falling, then the weighting based on reference-year prices diverges considerably from the way quantities would be weighted using current-year prices.Statistics Canada's new method minimizes this potential divergence. The method employs a concept known as a chain volume index, which refers to the way a series of price calculations, each involving volumes of output from two consecutive years, are linked together to form a continuous chain. To understand this approach, let's look at an economy's GDP in the same two years as before, 2014 and 2015. Calculating the change in real GDP using a chain volume index involves four basic steps. In the first step, the individual quantities that appear in GDP in each of the two years are both valued at 2014 prices to give two aggregate dollar amounts – one for total output in 2014 and one for total output in 2015. The first step is completed by the calculation of the percentage increase in total value, expressed in terms of 2014 prices, between these two years. In the second step, the calculations of the two aggregate dollar amounts are repeated, but now with 2015 rather than 2014 prices. The results of steps one and two are a pair of estimates of the percentage change in total value between the two years, one using 2014 prices and the other using 2015 prices. The third step involves taking the average of these two percentage changes, which gives a final estimate of the change in real GDP. In the fourth step, the 2015 estimate of real GDP is employed to derive the GDP deflator for 2015. This is done by rearranging the equation for the GDP deflator:GDP deflator (in hundredths) = nominal GDP / real GDPThe set of calculations outlined above is repeated for each pair of consecutive years, with the real GDP found for 2015 representing the starting point for the calculations involving 2015 and 2016. The result is a series of real GDP values much more closely tied to the underlying price changes taking place in the economy than the estimates found using Statistics Canada's former calculation method, even if it is a more involved and complicated procedure. Instructors may wish to suggest the way that derivation of the deflator has been updated in general terms, even if the particulars of this derivation are not covered in this course.Okun's LawIt's useful to stress to students that this law is simply a statistical estimate of an economic relationship, with the size of that estimate subject to change. When Arthur Okun first introduced the concept in 1962, he presumed that a one percent in the unemployment rate would lead to a reduction in real output of 3 percent. Later estimates for Canada and the US have shown a lower number. For example, one long-run study suggests the figure is about 2.5 percent for Canada (the figure used in the chapter), and about 2 percent for the United States. If recent data is correct, then this number may have fallen even further, especially in the aftermath of the 2008-09 recession to a figure around or below 2 percent. But it is too early to tell whether this is a permanent or temporary shift.From Course to CareerThe Ebook article From Course to Career included in Chapter 9 extends ideas covered in this chapter as well as in Chapter 7. Linking with material dealt with in this chapter, the article elaborates on the definition and measurement of youth underemployment, with a special emphasis on the impact of postsecondary education on youth underemployment rates. The article also elaborates on the notion of human capital introduced in Chapter 7. It provides estimates of the internal rate of return for different types of postsecondary education -- a type of comparative analysis that follows directly from the application of the concept of human capital to education.Answers to Thinking About Economics QuestionsPage 240: Deflation helps those whose incomes are fixed (or whose incomes do not fall) in nominal terms. For these people, real incomes increase, because nominal incomes stay the same while prices fall. Deflation that is unexpected also helps lenders. This is because actual real interest rates end up being higher than expected real interest rates. Others are hurt by deflation. Because deflation reduces business prospects, not only are entrepreneurs hurt, but also those who lose their jobs as a result of the self-feeding effects of deflation. Borrowers, too, are hurt by unexpected deflation.Page 246: In tandem with the lower actual unemployment rates in the US than in Canada, the American natural unemployment rate is likely to be below the Canadian natural unemployment rate as well.Answers to Chapter Problems9.1 Practice Problems1.a. Using 2014 prices the 2014 shopping basket has a value of $25 [= ($2.50 x 5) + ($1.25 x 10)]. Using 2015 prices the 2014 shopping basket has a value of $26.75 [= ($2.75 x 5) + ($1.30 x 10)].b. With 2014 as the base year, the 2014 value of the index is 100 [= ($25 / $25) x 100]. The 2015 value of the index is 107 [= ($26.75 / $25) x 100]. c. The inflation rate between these two years is 7% [= ((107 - 100) / 100) x 100].2.YearNominal GDP(current $ billion)GDP DeflatorReal GDP(2013 $ billions)2012[205.3]97.458210.72013234.3[100.000][234.3]2014245.9101.340[242.6]2015258.7[102.945]251.32016[275.6]105.438261.4Nominal GDP is found by multiplying real GDP by the GDP deflator expressed as a decimal. For 2012 it is $205.3 billion (= $210.7 billion x 0.97458). For 2016 it is $275.6 billion (= $261.4 billion x 1.05438). Because 2013 is the reference year the GDP deflator in 2013 is 100.000. The GDP deflator's 2015 value is found by dividing nominal GDP by real GDP then multiplying by 100 or 102.945 [= ($258.7 billion / $251.3 billion) x 100]. Because 2013 is the reference year real GDP in 2013 has the same value as nominal GDP ($234.3 billion). Real GDP in 2014 is $242.6 billion (= $245.9 billion / 1.01340). This is found by dividing the year's nominal GDP by the value of the GDP deflator expressed as a decimal.9.2 Practice Problems1.a. The labour force is the sum of the number of unemployed members of the labour force, workers with full-time jobs, part-time workers who wish to have full-time jobs, and part-time workers who do not wish to have full-time jobs or 31.4 million (= 2.3 million + 21.4 million + 3.5 million + 4.2 million).b. The labour force population is found by rearranging the formula used to derive the participation rate. This means dividing the labour force by the participation rate expressed as a decimal or 49.1 million (= 31.4 million / 0.64).c. The official unemployment rate is found by dividing the total number of unemployed members of the labour force by the labour force, then multiplying by 100 or 7.3% [= (2.3 million / 31.4 million) x 100].d. An unemployment rate that includes underemployment is found by summing the number of unemployed members of the labour force and the number of part-time workers who wish to have full-time jobs, dividing this amount by the labour force, then multiplying by 100 or 18.5% {= [(2.3 million + 3.5 million) / 31.4 million] x 100}.End of Chapter Problems1.a. In 2014, Student A spends $4.50 (= 3 x $1.50) on hotdogs, $12 (= 16 x $0.75) on cola, $7 (= 7 x $1) on chocolate bars, $10.50 (= 3 x $3.50) on magazines, and $6 (= 2 x $3) on movies, giving a shopping basket with a value of $40 (= $4.50 + $12 + $7 + $10.50 + $6). Item weights are 0.11 (= $4.50 / $40) for hotdogs, 0.30 (= $12 / $40) for cola, 0.18 (= $7 / $40) for chocolate bars, 0.26 (= $10.50 / $40) for magazines, and 0.15 (= $6 / $40) for movies.b. The value of Student A's 2014 shopping basket using 2015 prices would be $42.00 [= (3 x $1.60) + (16 x $0.70) + (7 x $1) + (3 x $4.50) + (2 x $2.75)]. The 2015 value of Student A's price index, using 2014 as the base year, is 105 [= ($42 / $40) x 100]. Given that 2014 is the base year, the 2014 value of the index is 100. The index has therefore changed by 5.0% {= [(105 - 100) / 100)] x 100} between 2014 and 2015.2.a. $178.00 [= (4 x $22.00) + (50 x $1.80)]b. $139.00 [= (4 x $16.00) + (50 x $1.50)]c. 128 [= ($178.00 / $139.00) x 100]d. The GDP deflator includes the quantities and prices of all of the products produced in the economy, whereas the consumer price index includes only a small subset of products commonly bought by consumers. In calculating the GDP deflator, prices in both the current year and reference year are weighted in terms of current-year quantities. In contrast, when calculating the consumer price index, prices in both the current year and base year are weighted in terms of base-year quantities.3.YearNominal GDP(current $ billion)GDP DeflatorReal GDP(2014 $ billions)2012[837.5]91.691913.42013982.498.923[993.1]20141,152.9[100.000][1,152.9]20151,373.8110.187[1,246.8]20161,589.6[120.598]1,318.1Nominal GDP is found by multiplying real GDP by the GDP deflator expressed as a decimal. For 2012 it is $837.5 billion (= $913.4 billion x 0.91691). Because 2014 is the reference year the GDP deflator is 100.000. The GDP deflator's 2016 value is found by dividing nominal GDP by real GDP then multiplying by 100, or 120.598 [= ($1,589.6 billion / $1,318.1 billion) x 100]. Real GDP in 2013 is $993.1 billion (= $982.4 billion / 0.98923) and in 2015 is $1,246.8 (= $1,373.8 billion / 1.10187). These values are found by dividing the year's nominal GDP by the value of the GDP deflator expressed as a decimal. Because 2014 is the reference year real GDP has the same value as nominal GDP ($1,152.9 billion).4.a. The lawyer is unaffected by inflation. With costs and revenues both rising by the inflation rate, the lawyer's net income will also increase by the same rate, leaving her real income constant. b. Because his restaurant is heavily in debt, this individual will probably benefit from unexpected inflation. The real interest rate paid on his outstanding debt is less than it would be in the absence of inflation.c. With a COLA clause in her contract, this worker is unaffected by inflation, since her nominal wage automatically rises by the inflation rate.d. This individual's income is only partially indexed, meaning that his nominal income does not rise as quickly as the inflation rate. Therefore, this individual is harmed by inflation, due to the decline in his real income.5.a. The real interest rate is 5% (= 9 - 4), and the desired real interest rate is 6% (= 9 - 3). Because the actual real interest rate is 1% less than was anticipated, borrowers are better off and lenders are worse off.b. The real interest rate is 8% (= 10 - 2), and the desired real interest rate is 6% (= 10 - 4). The actual real interest rate is therefore 2% more than was anticipated, which means that borrowers are worse off and lenders are better off.c. The real interest rate is 6% (= 8 - 2), and the desired real interest rate is 6% (= 8 - 2). There is no difference between the actual and desired real interest rates, so that both borrowers and lenders are unaffected.6.a. The nominal interest rate is the desired real interest rate plus the expected inflation rate or 1% [= 3 + (-) 2].b. The actual real interest rate is the nominal rate from part (a) minus the actual inflation rate or 4% [= 1 - (-)3].c. The actual real interest rate is 1% more than anticipated, which means that borrowers are made worse off and lenders are made better off.7.a. In 2014, the labour force population is 2.80 million (= 4.20 million - 1.40 million), the labour force is 1.75 million (= 1.20 million + 100,000 + 300,000 + 150,000), the participation rate is 62.5% [= (1.75 million / 2.80 million) x 100], and the official unemployment rate is 8.6% [= (150,000 / 1.75 million) x 100]. In 2015, the labour force population is again 2.8 million, the labour force is 1.96 million (= 1.3 million + 125,000 + 375,000 + 160,000), the participation rate is 70% [= (1.96 million / 2.8 million) x 100], and the official unemployment rate is 8.2% [= (160,000 / 1.96 million) x 100].b. The official unemployment rate has fallen between 2014 and 2015, even though there are more unemployed members of the labour force. The rising participation rate has meant that the increase in the size of the entire labour force has outweighed the increase in unemployment.c. In 2014, if we include the 400,000 discouraged workers in the unemployment rate, they must be added to both the numerator and denominator of the formula. With the incorporation of the 100,000 underemployed workers and the 400,000 discouraged workers in the numerator, the unemployment rate becomes 30.2% {= [(150,000 + 100,000 + 400,000) / (1.75 million + 400,000)] x 100}. In 2015, if we include the 500,000 discouraged workers in the unemployment rate, they must be added to both the numerator and denominator of the formula. With the incorporation of the 125,000 underemployed workers and the 500,000 discouraged workers in the numerator, the unemployment rate becomes 31.9% {= [(160,000 + 125,000 + 500,000) / (1.96 million + 500,000)] x 100}.8.a. Because there is a mismatch between their skills and available jobs this person is structurally unemployed. They are included in the official unemployment rate.b. This person has given up looking for work so is classified as a discouraged worker. They are not included in the official unemployment rate.c. This person is seasonally unemployed. Because the official unemployment rate referred to is the rate before seasonal adjustment they are included in this rate.d. This person is cyclically unemployed. They are included in the official unemployment rate.e. This person is underemployed. Given their current part-time job they are not included in the official unemployment rate.f. This person is frictionally unemployed and as long as he actively seeks employment is included in the official unemployment rate.9.a. In 2014, the unemployment rate was 0.7% (= 7.2 - 6.5) above the assumed natural rate. According to Okun's Law, real output could have been 1.75% (= 0.7 x 2.5) higher if unemployment equalled the natural rate. Thus GDP in 2012 dollars could have been $27.0 billion (= $1,543.2 billion x 0.0175) higher.b. In 2015, the unemployment rate was 1.8% (= 8.3 - 6.5) above the assumed natural rate. According to Okun's Law, real output could have been 4.5% (= 1.8 x 2.5) higher if unemployment equalled the natural rate. GDP in 2012 dollars could therefore have been $72.6 billion (= $1,612.8 billion x 0.045) higher.10.a. The value of Student A's 2015 shopping basket using 2015 prices is $40.05 [= (2 x $1.60) + (18 x $0.70) + (7 x $1) + (2 x $4.50) + (3 x $2.75)]. Item weights are 0.08 (= $3.20 / $40.05) for hotdogs, 0.31 (= $12.60 / $40.05) for cola, 0.17 (= $7.00 / $40.05) for chocolate bars, 0.22 (= $9.00 / $40.05) for magazines, and 0.21 (= $8.25 / $40.05) for movies (numbers do not add to 1 because of rounding).b. The value of this same basket in 2014 would be $39.50 [= (2 x $1.50) + (18 x $0.75) + (7 x $1) + (2 x $3.50) + (3 x $3)]. The 2014 value of Student A's price index, using 2015 as the base year, is 98.6 [= ($39.50 / $40.05) x 100]. Given that 2015 is the base year, the 2015 value of the index is 100.0. The index has therefore changed by 1.4% {= [(100 - 98.6) / 98.6] x 100} between 2014 and 2015.Internet Application Problems1.Access Statistics Canada's web site (at ). Enter your responses below rounded to 1 decimal place when applicable.a. Browse by subject to "Prices and price indexes", then select "Consumer price indexes" and find the "Consumer Price Index, by province" summary table. Use this data to find the annual changes in Canada's consumer price index for the years 2009 to 2011. Which component of the CPI has risen most quickly over this three-year period? Which component has fallen the most (or risen the least)? The annual change in the CPI for all-items in 2009 was [0.3]%, in 2010 was [1.8]%, and in 2011 was [2.9]%.The component of CPI that rose most quickly over this time period was [food*; shelter; household operations etc.; clothing and footwear; transportation; health and personal care; recreation, education, reading; alcohol and tobacco products] and the component that fell the most or rose the least was [food; shelter; household operations etc.; clothing and footwear*; transportation; health and personal care; recreation, education, reading; alcohol and tobacco products].b. Browse by subject to "Labour", then select "Employment and unemployment", and find the "Labour force characteristics" summary table to ?find (i) the unemployment rate, (ii) the participation rate, and (iii) the proportion of the working-age population (i.e. population 15 years and older) that is employed (known as the employment-to-population ratio) for Canada from 2009 to 2011. Explain how movements in these three variables have been related over the relevant time period.??200920102011 Unemployment rate[8.3][8.0][7.4]??Participation rate[67.1][67.0][66.8]??Employment to population ratio[61.6][61.6][61.8]- The employment to population ratio and participation rate seem to move together.- The participation rate and unemployment rate seem to move together.*- All three of these variables seem to move together.- The employment to population ratio and unemployment rate seem to move together.?Explanation:a.Food increased the most over the years 2009 to 2011 (4.9%, 1.4% and 3.7%) and clothing and footwear fell the most over the same time period (-0.4%, -1.8%, 0.3%).b.The participation rate and unemployment rate seem to move together, perhaps suggesting that some long-term unemployed persons became discouraged and left the labour force thus reducing both the participation rate and unemployment rate.2.Refer to the most recent issue of the OECD's Key Short-Term Indicators (at ). Browse to "Statistics", then scroll down the list to find the relevant data. Enter your responses below rounded to 1 decimal place.a. Use the dataset called "Unemployment rate" and click on "Download Excel" to see the table. Using this data find the annual unemployment rates in the seven large industrial economies in the OECD (the United States, Japan, Germany, the United Kingdom, France, Italy, and Canada) for the year 2011. Which of these countries has the highest unemployment rate? Which has the lowest? Where does Canada rank in this list??CountryUnemployment rate (%) United States[9.1] Japan[4.8] Germany[6.0] United Kingdom[8.0] France[9.3] Italy[8.5] Canada[7.5]The country with the highest unemployment is [United States, Japan; Germany; United Kingdom; France*; Italy; Canada] and the lowest is [United States, Japan*; Germany; United Kingdom; France; Italy; Canada]. If the country with the lowest unemployment is ranked as 1, Canada ranks at number [1; 2; 3*; 4; 5; 6; 7] in this list for the year 2011.b. Use the dataset under "Prices" called "Consumer price indices" by clicking "Get real-time data". Find the percentage change in the CPI in the same seven economies for 2011 using the fact that 2010 is the base year and therefore has an index value in each country of 100. Which of these countries has the highest inflation rate? the lowest? Where does Canada rank??CountryCPI inflation rate (%) United States[3.2] Japan[-0.3] Germany[2.1] United Kingdom[4.5] France2.1 Italy2.8 Canada2.9The country with the highest inflation rate is [United States, Japan; Germany; United Kingdom*; France; Italy; Canada] and the lowest is [United States, Japan*; Germany; United Kingdom; France; Italy; Canada]. If the country with the lowest inflation is ranked as 1, and any countries with tied rankings are counted separately, Canada ranks at number [1; 2; 3; 4; 5*; 6; 7] in this list for the year 2011.?Explanation:a.France had the highest unemployment rate, Japan the lowest, and Canada landed at number 3 in that list for 2011.b.The United Kingdom had the highest inflation rate, Japan the lowest, and Canada ranked at number 5.3. (Essay) Employ the Bank of Canada's online Inflation Calculator (at ) to calculate the overall changes in the CPI, and the average inflation rates, between the years paired below. Enter your responses below rounded to 2 decimal places.a. Between 2000 and 2009b. Between 1990 and 1999c. Between 1980 and 1989?Explanation:a. Exact answers will vary depending on which month of the calendar year the calculator is accessed. The total change in the CPI (with base year 2002) is found using the values of the index in 2000 and 2009, or [(2009 index value - 2000 index value)/2000 index value) x 100]. The average annual inflation rate is the one that, if repeated each year during this time period would lead to the overall change.b. The total change in the CPI (with base year 2002) is found using the values of the index in 1990 and 1999, or [(1999 index value - 1990 index value)/1990 index value) x 100]. The average annual inflation rate is the one that, if repeated each year during this time period would lead to the overall change.c. The total change in the CPI (with base year 2002) is found using the values of the index in 1980 and 1989, or [(1989 index value - 1980 index value)/1980 index value) x 100]. The average annual inflation rate is the one that, if repeated each year during this time period would lead to the overall of Form4.Access Statistics Canada's CANSIM site (at ). Browse by subject to "Labour", then select "Employment and unemployment", and find the "Employment by age, sex, type of work, class of worker and province (monthly)" summary table. Scroll to below the table to find "Sources: Statistics Canada, tables 292-0087 and 282-0089" and click on "292-0087" to take you to CANSIM table 292-0087. Then click on the "Add/Remove data" tab. Find "Step 1- Select: Geography" and choose "Canada", under step 2 select: "Unemployment rate", under step 3 select "Males" and also select "Females", under step 4 select "15 years and over", under step 5 select "Seasonally adjusted", and under step 6 select January of 1980 to December of 2010. Then press the "Apply" button under step 8. Next go to the "Manipulate" tab to change the "frequency of output data will be" to "Annual (average)" and then press "Apply". Use the resulting data to answer the questions below.a. Fill in the table showing the annual unemployment rates for men 15 years and over and women 15 years and over for the years shown in the table below. Enter your responses rounded to 1 decimal place.?Annual unemployment rate for1980198519901995200020052010 Men[7.0][10.4][8.2][9.8][7.0][7.0][8.7] Women[8.3][10.6][8.1][9.1][6.7][6.5][7.2]b. In the early part of this period the unemployment rate for women in Canada was [higher*; lower] than for men. In the later part of this period the unemployment rate for men was [higher*; lower] than for women.The switch in the sizes of the two rates occurred between [1980 and 1985; 1985 and 1990*; 1990 and 1995; 1995 and 2000; 2000 and 2005; 2005 and 2010].One reason for this switch is that women are more heavily represented in the [low-growth service sector; high-growth service sector*; low-growth manufacturing sector; high-growth manufacturing sector] than are men.??Explanationb. In the early part of this period the unemployment rate for women in Canada was higher than for men, while in the later part the rate is higher for men. The switch in the sizes of these two rates occurred between 1985 and 1990. One reason is that women are more heavily represented in the high-growth service sector.Advancing Economic Thought Problem1(Essay) a. In 2016, young people aged 15 to 24 were born from the early 1990s to the early 2000s, and are therefore split between members of the baby-boom echo and children of the baby bust. In 2026, young people in the same age bracket will almost all be from the smaller generation of children of the baby bust. Because there will be fewer young people entering the labour force in 2026 than in 2016, then everything else remaining the same the youth unemployment rate will fall.b. ?On average, people tend to be net borrowers early in life and net lenders in their later years. Between 2016 and 2026, more baby boomers will stop being net borrowers and turn into net lenders, decreasing the demand for loans and increasing the supply. Everything else remaining the same, the result will be a drop in interest rates.c. The demand for real estate is heavily affected by the number of first-time home-buyers, who tend to be in their early thirties. Between 2016 and 2026, first-time home-buyers will increasingly be members of the echo generation. Everything else remaining the same, this will cause an increase in housing sales.d. Between 2016 and 2026 aging baby-boomers will have a growing pool of wealth to place in financial investments. Meanwhile, declining interest rates will make fixed-income assets such as bonds and bank deposits relatively unattractive. Everything else remaining the same, demand for stocks will rise during this decades, putting upward pressure on stock market prices.e. As the proportion of Canadians 65 and over increases between 2016 and 2026, pension plans will see total payouts to retirees increase, placing pressure on pension plans, both those in the public sector like CPP and those administered privately, to increase the premiums paid by working Canadians.Advancing Economic Thought Internet Application Problem1.Access Statistics Canada's website (at ). Browse by subject to "Population and demography" then select "Population estimates and projections" to access Statistic Canada's population projections for various age groups. Find the summary table "Projected population by age group according to three projection scenarios..." and notice the years listed in the left hand column determine the data shown in the chart. To answer the questions below use the "Medium growth" projection scenario.?Enter all your responses below rounded to 1 decimal place.a. Calculate the projected percentages of the population in the 0–24, 25–39, 40–64, and 65+ age groups, both in 2016 and 2026, based on the assumption of medium growth.??Projected population in thousands:Projected percentage of the population:Age Group2016202620162026??All ages[36,493.8][37,171.1]??0-24[10,452.4][10,010.5][28.6][27.9]??25-39[7,558.1][7,639.3][20.7][20.4]??40-64[12,230.4][12,540.3][34.3][33.2]??65+[5,956.3][6,981.0][16.3][18.5]b. Using the concepts introduced in Foot's article, explain the projected changes in the relative sizes of each of these age groups between 2011 and 2031.???The 0-24 age group will [grow; shrink*] as a percentage of the population between 2016 and 2026. In 2016 this group is [from before the baby-boom and some of the baby-boom; some of the baby-boom and the beginning of the baby bust; the end of the baby bust and beginning of the baby-boom echo; the end of the baby-boom echo, children of the baby bust and some children of the baby-boom echo*] while in 2026 they are [the baby-boom; the baby bust and baby-boom echo; the children of the baby bust; the children of the baby-bust and baby-boom echo*].???The 25-39 age group will [grow; shrink*] as a percentage of the population between 2016 and 2026. In 2016 this group is [from before the baby-boom and some of the baby-boom; some of the baby-boom and the beginning of the baby bust; the end of the baby bust and baby-boom echo*; the end of the baby-boom and children of the baby bust] while in 2026 they are [the baby-boom; the baby bust and baby-boom echo; the end of the baby-boom echo and the children of the baby bust*; the children of the baby-boom echo].???The 40-64 age group will [grow; shrink*] as a percentage of the population between 2016 and 2026. In 2016 this group is [from before the baby-boom and some of the baby-boom; some of the baby-boom and the beginning of the baby bust*; the end of the babe bust and beginning of the baby-boom echo; the end of the baby-boom and children of the baby bust] while in 2026 they are [the baby-boom and the start of the baby-bust; the baby bust and the start of the baby-boom echo*; the children of the baby bust; the children of the baby-boom echo].???The 65+ age group will [grow; shrink] as a percentage of the population between 2016 and 2026. In 2016 this group is [some from before the baby-boom and some of the baby-boom*; some of the baby-boom and the beginning of the baby bust; the end of the baby bust and beginning of the baby-boom echo; the end of the baby-boom echo and children of the baby bust] while in 2026 they are [some from before the baby-boom and most of the baby-boom*; some of the baby-boom and the beginning of the baby bust; the end of the baby bust and beginning of the baby-boom echo; the end of the baby-boom echo and children of the baby bust].Explanation:a. The data presented are found in the links to 'Summary Tables', 'Tables by subject', 'Population and Demography', 'Population estimates and projections', 'Projected population by age group and sex according to a medium growth scenario for 2006, 2011, 2016, 2021, 2026 and 2031.'In 2016 the projected proportions of the population are 28.6% [= (10,452.4 million / 36,493.8 million) x 100%] for the 0-24 age group, 20.7% [= (7,558.1 million / 36,493.8 million) x 100%] for the 25-39 group, 34.3% [= (12,230.4 million / 36,493.8 million) x 100%] for the 40-64 group and 16.3% [= (5,956.3 million / 36,493.8 million) x 100%] for the 65+ group.In 2026 the proportions are 27.9% [= (10,010.5 million / 37,171.1 million) x 100%] for the 0-24 age group, 20.4%, [= (7,693.3 million / 37,171.1 million) x 100%] for the 25-39 group, 33.2% [= (12,540.3 million / 37,171.1 million) x 100%] for the 40-64 group and 18.5% [= (6,981.0 million / 37,171.1 million) x 100%] for the 65+ group.b. The 0-24 age group is born from 1992 to 2016 in the year 2016 and from 2002 to 2026 in the year 2026. The group shrinks from 28.6% to 27.9% of the total population from 2016 to 2026. In 2016 it includes the end of baby-boom echo (born 1992 to 1995), the children of the baby bust (born 1996 to 2011) and the beginning of the children of the baby-boom echo (born 2012 to 2016). In 2026 it includes the end of the children of the baby bust (born 2022 to 2011) and the children of the baby-boom echo (born 2012 to 2026).The 25-39 age group is born from 1977 to 1991 in the year 2016 and from 1987 and 2001 in the year 2026. The group shrinks from 20.7% to 20.4% of the total population from 2016 to 2026. In 2016 it includes the end of the baby bust (born 1977 to 1979) and the baby-boom echo (born 1980 to 1991). In 2026 it includes the end of the baby-boom echo (born 1987 to 1995) and the children of the baby bust (born 1996 to 2001).The 40-64 age group is born from 1952 to 1976 in the year 2016 and from 1962 to 1986 in the year 2026. The group shrinks from 34.3% to 33.2% of the total population from 2016 to 2026. In 2016 it includes the some of the baby boom (born 1952 to 1966) and the start of the baby bust (born from 1967 to 1976). In 2026 it includes the end of the baby boom (born 1962 to 1966), the baby bust (born 1967 to 1979) and the start of the baby-boom echo (born 1980 to 1986).The 65+ age group is born in 1951 and earlier in the year 2016 and are born in 1961 and earlier in the year 2026. The group expands from 16.3% to 18.5% of the total population between 2016 and 2026. In 2016 it includes some from before the baby boom (born before 1947) and the start of the baby boom (born 1947 to 1951). In 2026 it includes some from before the baby boom (again, born before 1947) and most of the baby boom (born 1947 to 1961).Simulation1. Introductory InformationTime:Approximately 20 minutes.Materials:A package of multicolored construction paper.?Print the appropriate information, from below, on each coloured card.There should be one card made for each student.Card Information:Yellow Card: You are over 18 years of age and are employed in a full time job.Red Card: You are 14 years of age and make pocket money by mowing lawns.Blue Card: You are over 18 years of age. You are having trouble finding a job, but currently looking.Green Card: Though you have a college diploma, you have been employed in a succession of unskilled jobs for the past four years because you could not find a job that uses your education.Orange Card: You are over 18 years of age. You spent a long time looking for a job, but you have given up trying to find one.Pink Card: You worked for a company that upholstered furniture until recently, when the employer closed its Canadian plant and moved its operations overseas. You are looking for a new position that uses your current skills.Purple Card: You have just received a university degree and you haven't yet been able to find a job yet. You are submitting your resume everywhere.White Card: You used to work the cash register at a popular Italian restaurant, but you were laid off when the economy slumped and consumers began eating out less often. You are looking widely for a new job, though your previous boss has told you that she will hire you back if business picks up again.Black Card: You work on a lobster boat, but you are not currently working because it is not lobster season in your area, and the government will allow your employer to fish only three months per year. You are receiving employment insurance benefits, which requires you to look for work during times when there is no lobster fishing.Set-up:Give each student one, and only one, card.All of the different colours of cards should be used.Key Concepts Covered:cyclical unemploymentdiscouraged workersfrictional unemploymentlabour force populationlabour forceseasonal unemploymentstructural unemploymentunderemploymentunemployment rateLearning Objectives:- Explain and evaluate how the unemployment rate is calculated and gain an understanding of who makes up the labour force and labour force population.- Illustrate and discuss the various types of unemployment and related situations -- including cyclical unemployment, frictional unemployment, seasonal unemployment and structural unemployment as well as discouraged workers and underemployment -- and the impact they have on individuals and society.2. ExerciseRecall that students have each been given one card.??Timekeeper: N/A?Stage 1: Each student has?been given a different coloured card describing some key personal and employment characteristic.??Once every student has a card they should all line up on one side of the room with their cards.The instructor will call out different employment criteria (shown below Stage 2). The students who feel they meet the criteria, according to description on their card, will move to the other side of the room.Once the students have organized themselves on the other side of the room, they will read out what is written on their cards one by one. The rest of the class will determine if the student is correct in his/her assessment.Stage 2: After one criterion is completed, reset and repeat the game with the next criterion on the list below. Repeat the process for several different criteria, as many as desired. The criteria are as follows:1) a member of the labour force population2) a member of the labour force3) officially employed4) officially unemployed5) frictionally unemployed6) structurally unemployed7) cyclically unemployed8) seasonally unemployed9) a discouraged worker10) underemployedStudents with which coloured cards should move to the other side of the room in each case from above?1) everyone except those with red cards2) everyone except those with red and orange cards3) those with yellow and green cards4) those with purple, pink, white and black cards5) those with purple cards6) those with pink cards7) those with white cards8) those with black cards9) those with orange cards10) those with green cardsExplanation:1) a member of the labour force population (everyone except those with red cards)2) a member of the labour force (everyone except those with red and orange cards)3) officially employed (those with yellow and green cards)4) officially unemployed (those with purple, pink, white and black cards)5) frictionally unemployed (those with purple cards)6) structurally unemployed (those with pink cards)7) cyclically unemployed (those with white cards)8) seasonally unemployed (those with black cards)9) a discouraged worker (those with orange cards)10) underemployed (those with green cards)3. Discussion Questions (essay)1. Describe a situation where someone would be considered underemployed. What are some factors that could cause this to happen?2. Describe a job where someone would experience seasonal unemployment Why is this job seasonal? Explain.?Explanation:1. Answers will vary. Students may reference personal reasons or economic reasons in explaining the situation of the person whose work conditions they are highlighting. One frequent example is the underemployment of immigrants. An immigrant may have been trained to be an engineer, doctor, or other profession but in a country where the qualifications or standards are not considered equivalent to Canadian standards. Another example is someone who has a bachelor's degree from a Canadian university but works at a fast-food outlet in order to support themselves and their families because they graduated at a time of high unemployment and low economic growth, such as in the early 1990s or after 2008, and were unable to find a higher level job.2. Answers will vary. Possible examples include jobs in construction, forestry, and fishing. Work is seasonal in Canada because of winter. Many jobs cannot be done when the ambient temperature falls below freezing4. Multiple Choice Questions1. A 13-year-old who occasionally babysits for cash is considered:seasonally unemployed.not part of the labour force.*part of the labour force.officially unemployed.officially employed.2. A person who is over 18 years old and who has given up looking for work would be considered:a discouraged worker.*employed.frictionally unemployed.seasonally unemployed.none of the above3. A construction worker who is unemployed during winter months would be considered:cyclically unemployed.frictionally unemployed.seasonally unemployed.*structurally unemployed.all of the above4. A janitor with an engineering degree would be considered:a discouraged workerfrictionally unemployedfully employedunderemployed.*none of the above5. A student who has just graduated and is looking for a job would be considered:cyclically unemployed.frictionally unemployed.*seasonally unemployed.structurally unemployed.all of the above?Explanation:1. A 13-year-old who occasionally babysits for cash is considered not part of the labour force as the labour force only includes those 15 years of age and older. 2. A person who is over 18 years old and who has given up looking for work would be considered a discouraged worker because they are no longer actively seeking employment.3. A construction worker who is unemployed during winter months would be considered seasonally unemployed since they can expect to be employed in their occupation during the summer months.?4. A janitor with an engineering degree is not using their skills to their full potential so would be considered underemployed.5. A student who has just graduated and is looking for a job would be considered frictionally unemployed since they are looking for their first job. ................
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