Question

measuring employment unemployment and labor force participation

Consider a small economy composed of five people: Carl, Becky, Nathan, Rajiv, and Rosa. Each person's employment status is described as follows Based on the criteria used by the Bureau of Labor Statistics (BLS), classify each person as employed, unemployed, not in the labor force (but still part of the adult population), or not in the (civilian noninstitutionalized) adult population Person Status Rajiv is a 25-year-old who lost his job as a copyeditor for a local newspaper. He's Unemployed spent the past few weeks out of work and interviewing for other editing jobs. He's thinking about going back to grad school if his job search doesn't pan out after a few more weeks Nathan is a 78-year-old retired professor. He enjoys volunteering at the local public Employed library Rosa is an 18-year-old who just graduated from high school. She's taking it easy Not in Labor Force this summer, relaxing by the pool with her friends and family and volunteering part-time at the local nursing home Becky is a 37-year-old professional basketball player. She finished her last season as a player three weeks ago and is currently interviewing for a coaching position Carl is an 83-year-old professor. He only teaches one or two courses a year, but he's still pursuing an active research agenda The unemployment rate reported by the BLS is given by the formula: Number of Unemployed Workers Unemployment Rate - Number in Labor Force According to this formula, what is the unemployment rate of this economy? o 80% o 33% o 50% o 60% о 67%

Answer 1

Rajiv is Unemployed

Nathan is not in the labor force

Rosa is not in the labor force

Becky is Unemployed

Carl is Employed

Unemployment rate = number of unemployed workers/labor force

labor force = unemployed+employed = 3

Unemployment rate = 2/3*100 = 67%