If there are discouraged workers:
A)they are included in the official count of the unemployed.
B)the unemployment rate will tend to overstate the true level of unemployment.
C)the unemployment rate will tend to understate the true level of unemployment.
D)they are considered part of the labor force.

Question

If there are discouraged workers:
A)​they are included in the official count of the unemployed.
B)​the unemployment rate will tend to overstate the true level of unemployment.
C)​the unemployment rate will tend to understate the true level of unemployment.
D)​they are considered part of the labor force.

Quizplus · Accepted Answer

Discouraged workers are those who have given up on finding work and are no longer actively seeking employment. They are not included in the official count of the unemployed. If they were included, the unemployment rate would be higher and more accurately reflect the true level of unemployment. Therefore, the unemployment rate tends to understate the true level of unemployment when there are discouraged workers.

If There Are Discouraged Workers