In an economy, 23 million people are employed and 2 million are unemployed, but 5 million part-time workers would prefer full-time work. What is the unemployment rate?

Question

Quizplus · Accepted Answer

The unemployment rate is calculated by dividing the number of unemployed individuals by the total labor force (employed plus unemployed). 
Labor force = employed + unemployed = 23 million + 2 million = 25 million 
Unemployment rate = (unemployed / labor force) x 100 
Unemployed = 2 million + 5 million (part-time workers who want full-time work) = 7 million 
Unemployment rate = (7 million / 25 million) x 100 = 28 percent 
However, the question only asks for the unemployment rate, not the underemployment rate (which includes the part-time workers who want full-time work). 
So, the correct answer is B) 8 percent: 
Unemployment rate = (2 million / 25 million) x 100 = 8 percent.

In an Economy, 23 Million People Are Employed and 2