Macroeconomics 11th Edition by Michael Parkin

Exercise 33

Jobs Report: Hiring Up, Unemployment Down
The Labor Department reported that hiring accelerated in November, and the unemployment rate fell to 8.6 percent from 9 percent in October. Two reasons for the fall are that more Americans got jobs, but even more people gave up on their job searches altogether.
a. If the only change was that all the newly hired people had been unemployed in October, explain how the labor force and unemployment would have changed.
b. If the only change was that people gave up on their job searches, explain how the labor force and unemployment would have changed.