All else equal, if unemployment rises to 8 percent after a 3.5 percentage point increase, this indicates that:

Question

Quizplus · Accepted Answer

A 3.5 percentage point increase in unemployment means that the new unemployment rate is 3.5 percentage points higher than the previous rate. Therefore, if the unemployment rate rises to 8 percent after a 3.5 percentage point increase, the previous rate was 4.5 percent (8% - 3.5% = 4.5%). This means that 35 out of every 1,000 in the labor force have lost a job (3.5% of 1,000 = 35).

All Else Equal, If Unemployment Rises to 8 Percent After