In the Two-Sided Search Model, If the Cost of Posting

question 10

Multiple Choice

In the two-sided search model, if the cost of posting a vacancy rises for firms, then

• A)labour market participation rises, unemployment rises, and vacancies fall.
• B)unemployment falls, vacancies fall, and output falls.
• C)labour market participation falls, unemployment rises, and output falls.
• D)labour market participation rises, vacancies fall, and unemployment rises.
• E)unemployment rises, vacancies rise, and output falls.

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Definitions:

Labor-saving Technological Change

It refers to innovations or advancements in technology that reduce the amount of labor required to produce goods or services, often leading to increased productivity.

Telephone Operators

Individuals responsible for assisting customers in making telephone connections, including placing and connecting calls or providing information.

Machine-sewn Products

Goods that are manufactured using sewing machines, often implying mass production and consistent quality.

Wage Rate

The amount of money paid to an employee per unit of time, such as an hour or a week.