If the unemployment rate is 6% before a rise in government purchases, and if a rise in government purchases induces the typical unemployed person to search 10% longer in the hopes of finding a high-paying government job, what will the unemployment rate be after the rise in government purchases? Only consider the impact of this waiting-for-a-good-job effect.

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter18: Introduction To Macroeconomics: Unemployment, Inflation, And Economic Fluctuations
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 If the unemployment rate is 6% before a rise in government purchases, and if a rise in government purchases induces the typical
unemployed person to search 10% longer in the hopes of finding a
high-paying government job, what will the unemployment rate be
after the rise in government purchases? Only consider the impact
of this waiting-for-a-good-job effect.

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