Table 5-8 shows employment data for an economy. Use the table to answer questions .
Table 5-8

-Refer to Table 5.8. Now suppose 4,000 of the people looking for work get discouraged and give up their job searches. The unemployment rate becomes _____.

Question

Table 5-8 shows employment data for an economy. Use the table to answer questions .
Table 5-8
 
-Refer to Table 5.8. Now suppose 4,000 of the people looking for work get discouraged and give up their job searches. The unemployment rate becomes _____.

Quizplus · Accepted Answer

The unemployment rate is calculated by dividing the number of unemployed individuals by the total labor force. The labor force equals the sum of employed and unemployed individuals. If 4,000 people give up their job search, they are no longer considered unemployed and are removed from the labor force. The new labor force would equal 92,000 (88,000 employed + 4,000 unemployed), and the new number of unemployed individuals would be 5,500 (9,500 - 4,000). Thus, the unemployment rate would be 5,500/92,000 = 5.97%.

Table 5-8 Shows Employment Data for an Economy