Suppose the unemployment rate is currently at 5 percent. If the number of unemployed increases by the same number as the number of people unemployed, then:
A) the labor force participation rate will decrease.
B) the unemployment rate will decrease.
C) the unemployment rate will increase.
D) the population growth rate will increase.

Question

Quizplus · Accepted Answer

If the number of unemployed increases by the same number as the number of people employed, then the unemployment rate will increase. This is because the increase in the number of unemployed individuals will cause the labor force to grow while the number of individuals employed remains the same, resulting in a higher unemployment rate. The labor force participation rate and population growth rate are not directly affected by this change.

Suppose the Unemployment Rate Is Currently at 5 Percent