Question

Suppose that the Bureau of Labor Statistics reports that the entire adult population of Mankiwland can be categorized as follows: 25 million people employed, 3 million people unemployed, 1 million discouraged workers, and 1 million people who are either students, homemakers, retirees, or other people not seeking employment. Refer to Scenario 28-1. What is the unemployment rate?

a.3.3%
b. 12%
c. 10.7%
d. 6.7%

Answer 1

Answer:

c. 10.7%

Explanation:

unemploymnet rate = (unemployed x 100 ) / labor force = 300 / 28 = 10.7%

Answer 2

Answer:

The correct answer is option (C)  10.7%

Explanation:

Solution:

Data Given;

Employed people = 25 million

Unemployed people = 3 million

Discourage workers = 1 million

General = 1 million

Unemployment rate =?

To calculate the rate of unemployment, we use the formula;

Unemployment rate =

(number of unemployed people / total labor force) * 100

But total labor force =

number of employed people + number of  unemployed people

                                    = 25,000,000 + 3, 000,000

                                    =28,000,000

Therefore,

Unemployment rate = (3,000,000 /28,000,000) * 100

                                   = 0.107 *100

                                  = 10.7%