Gm 544 Case Study

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Yolanda Scott Business Economics GM 545 Spring 2013 YolandaAScott@Yahoo.com Exercise 1: Chapter 16 Question 5 Frictional unemployment is one type of unemployment and occurs when people move or change jobs. Individuals taking their first job tend to have higher than average rate of turnover. Settling into to a long-term job can be difficult. This type of unemployment is a choice on the part of the individual. Frictional unemployment is necessary to promote effective placement of workers to jobs. A worker can leave a job they do like and are not good at so they then can find a new job that they do like and are good at. Some percentage of frictional employment is desired so individuals are in a job they enjoy and are comfortable with and able to perform well. In the face of a recession this type of unemployment is reduced because people are afraid to leave their job. It does not matter…show more content…
Protectionism endanger a consumer’s right to choose from a wide variety of goods and services. The defense argument is that it protects higher prices, lower quality goods, economic stagnation and among other things. It is a form of purism when it comes to the trade barriers being in place. It is defended that is in place because consumers to purchasing foreign made products will cause unemployment here in America. The theory is that jobs are lost when we are tempted by cheap foreign goods. The true effect of protectionism is it reduces consumer choice, raises prices of protected foreign products and domestic goods. This lowers worldwide production and may save some jobs in a specific industry within America but this comes at an expense of the total welfare of the country. Free trade would provide lower prices, higher-quality goods, economic growth, and competition. This policy eliminates competition and competition is needed for a balanced economy. (Younkins,
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