Data for an economy show that the unemployment rate is 10%,the participation rate is 80%,and 200 million people 15 years or older are not in the labour force.How many people are unemployed this economy?
A) 20 million.
B) 80 million.
C) 200 million.
D) 800 million.
E) 1,000 million.

Question

Quizplus · Accepted Answer

The participation rate is 80%, meaning 80% of the working-age population is in the labor force. If 200 million people are not in the labor force, then 80% of the total population is in the labor force. Therefore, the total working-age population is 200 million / 20% = 1,000 million. The labor force is 80% of 1,000 million, which is 800 million. With an unemployment rate of 10%, the number of unemployed people is 10% of 800 million, which is 80 million.

Data for an Economy Show That the Unemployment Rate Is