Which of the following best describes the presence of discouraged workers?
A)The unemployment rate will tend to overstate the true level of unemployment when they are present.
B)The unemployment rate will tend to understate the true level of unemployment when they are present.
C)They are considered part of the labour force.
D)They are included in the official count of the unemployed.

Question

Quizplus · Accepted Answer

Discouraged workers are those who have given up on finding a job and are no longer actively seeking employment. They are not included in the official count of the unemployed because they are not currently looking for work. However, they are still considered part of the potential labor force and their presence tends to understate the true level of unemployment because they are not included in the unemployment rate calculation.

Which of the Following Best Describes the Presence of Discouraged