In an economy, 40 million people are employed, 2 million are unemployed, and 8 million are not in the labor force. What is the labor force participation rate?

Question

Quizplus · Accepted Answer

The labor force participation rate is calculated as the labor force divided by the total adult population, multiplied by 100. The labor force is the sum of employed and unemployed people, which is 42 million (40 million employed + 2 million unemployed). The total adult population is the labor force plus those not in the labor force, which is 50 million (42 million + 8 million). Thus, the labor force participation rate is (42/50) * 100 = 84 percent.

In an Economy, 40 Million People Are Employed, 2 Million