The unemployment rate will increase whenever there is a(n):
A) increase in the number of persons classified as unemployed.
B) increase in the number of unemployed persons relative to the size of the labor force.
C) increase in the size of the U.S. population and there is no change in the number of persons classified as employed.
D) reduction in the size of the labor force.
E) reduction in the size of the civilian labor force while the number of unemployed decreases.

Question

Quizplus · Accepted Answer

The unemployment rate is calculated by dividing the number of unemployed persons by the total labor force (employed + unemployed). Therefore, an increase in the number of unemployed persons relative to the size of the labor force will result in an increase in the unemployment rate. The other choices either refer to changes in the absolute number of employed or unemployed persons, or changes in the size of the labor force without regard to the number of unemployed persons.

The Unemployment Rate Will Increase Whenever There Is A(n)