If the number of potential workers in an economy increases while the size of the labor force remains unchanged,________.

Question

Quizplus · Accepted Answer

When the number of potential workers in an economy increases but the labor force remains the same size, the labor force participation rate falls. This is because the labor force participation rate is calculated as the labor force divided by the total number of potential workers. If the denominator increases while the numerator remains constant, the ratio decreases.

If the Number of Potential Workers in an Economy Increases