Question

Suppose that an economy has 9 million people working full-time. It also has 1 million people who are actively seeking work but currently unemployed as well as 2 million discouraged workers who have given up looking for work and are currently unemployed. What is this economy's unemployment rate? b. 15 percent. c. 20 percent. d. 25 percent.

Name: Problem 3, Chapter 29: Economics: Principles, Problems, and Policies
Uploaded: 2021-02-03T12:42:46-08:00
Duration: 1 min 8 s
Channel: Prashant Bana
Description: Suppose that an economy has 9 million people working full-time. It also has 1 million people who are actively seeking work but currently unemployed as well as 2 million discouraged workers who have given up looking for work and are currently unemployed. What is this economy's unemployment rate? b. 15 percent. c. 20 percent. d. 25 percent.

   Suppose that an economy has 9 million people working full-time. It also has 1 million people who are actively seeking work but currently unemployed as well as 2 million discouraged workers who have given up looking for work and are currently unemployed. What is this economy's unemployment rate?
b. 15 percent.
c. 20 percent.
d. 25 percent.

Economics: Principles, Problems, and Policies

Campbell R.… 21st Edition

Chapter 29, Problem 3

Instant Answer

Solved by Expert Prashant Bana

02/03/2021

Step 1

The labor force is the sum of the number of people who are employed and the number of people who are unemployed but actively seeking work. In this case, the labor force is 9 million (employed) + 1 million (unemployed but actively seeking work) = 10 million. Show more…

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Suppose that an economy has 9 million people working full-time. It also has 1 million people who are actively seeking work but currently unemployed as well as 2 million discouraged workers who have given up looking for work and are currently unemployed. What is this economy's unemployment rate? b. 15 percent. c. 20 percent. d. 25 percent.

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Key Concepts

Discouraged Workers

Discouraged workers are individuals who are not actively seeking employment because they believe there are no job opportunities available for them. Since these individuals are not actively looking for work, they are not counted as part of the labor force, which affects the calculation of the unemployment rate.

Labor Force

The labor force includes all individuals who are employed as well as those who are unemployed but actively looking for work. It does not include individuals who are not seeking employment, such as discouraged workers or those outside the working-age population.

Unemployment Rate

The unemployment rate is a measure of the percentage of people in the labor force who are actively seeking, but are unable to find, employment. It is calculated by dividing the number of unemployed individuals by the total number of people in the labor force and then multiplying by 100 to express it as a percentage.

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