The following information is about a hypothetical economy: Full-time employed = 80
Part-time employed = 25
Unemployed = 15
Discouraged workers = 5
Members of underground economy = 6
Consumer Price Index = 110
Refer to the above information.The unemployment rate is:
A)18.8 percent.
B)12.5 percent.
C)16.7 percent.
D)25 percent.

Question

Quizplus · Accepted Answer

The unemployment rate is calculated as the number of unemployed divided by the labor force (full-time employed + part-time employed + unemployed), which is (15 / (80 + 25 + 15)) * 100 = 12.5 percent. Discouraged workers and members of the underground economy are not included in the labor force calculation.

The Following Information Is About a Hypothetical Economy: Full-Time Employed