Final answer:
The unemployment rate is calculated by dividing the number of unemployed people by the total labor force and then multiplying by 100 to get the percentage. In this case, it is (50 unemployed / 400 total labor force) × 100, resulting in an approximate unemployment rate of 12.5%.
Step-by-step explanation:
In order to determine the unemployment rate, we can follow a similar approach as outlined in the examples given. For an economy of 850 people with a labor force of 400 people and 350 employed, we first need to calculate the number of unemployed people. This is the difference between the labor force and the number of employed people:
- Labor Force = 400 people
- Employed People = 350 people
Unemployed People = Labor Force - Employed People = 400 - 350 = 50
Now, to calculate the unemployment rate, divide the number of unemployed people by the total labor force and then multiply by 100 to get the percentage:
Unemployment Rate = (Unemployed People / Labor Force) × 100
Unemployment Rate = (50 / 400) × 100 = 12.5%
Therefore, the approximate unemployment rate in such an economy would be 12.5%, which corresponds to option b.