Which of the following causes the unemployment rate to understate the true extent of joblessness?
A)Many full time workers really want to be part time workers.
B)Persons who collect unemployment benefits report themselves to be searching for a job.
C)Discouraged workers are not counted as unemployed.
D)A drug dealer reports herself as unemployed.
E)Discouraged workers are counted as unemployed.

Question

Quizplus · Accepted Answer

Discouraged workers are individuals who have given up looking for a job because they are unable to find one, and they are not included in the labor force. Therefore, the unemployment rate does not include them, which leads to an understatement of the true extent of joblessness. Option A is incorrect because it suggests that part-time workers are not employed, which is not true. Option B is incorrect because while individuals receiving unemployment benefits are required to actively search for jobs, it doesn't necessarily mean they are unemployed. Option D is incorrect because a drug dealer is not considered a part of the labor force, and thus, can't be counted as unemployed. Option E is also incorrect as it is the opposite of what is being asked in the question.

Which of the Following Causes the Unemployment Rate to Understate