Data for an economy shows that the unemployment rate is 6%, the participation rate 60 percent, and 200 million people 16 years or older are not in the labor force. How many people are employed in this economy?
A) 30 million
B) 188 million
C) 282 million
D) 300 million

Question

Quizplus · Accepted Answer

To find the number of employed people, first calculate the labor force: 200 million people are not in the labor force, so the total population 16 years or older is 200 million / (1 - 0.60) = 500 million. The labor force is 60% of 500 million, which is 300 million. With a 6% unemployment rate, 94% of the labor force is employed, so 0.94 * 300 million = 282 million people are employed.

Data for an Economy Shows That the Unemployment Rate Is