Question

Suppose the official unemployment rate is 10 percent. Which of the following is a definite conclusion to draw?

a. The economy is in a recession.
b. There is no underemployment in the economy.
c. 10 percent of the working-age population is employed.
d. 10 percent of the labor force is unemployed.

Answer 1

The correct conclusion to draw from an official unemployment rate of 10 percent is that 10 percent of the labor force is unemployed.

Step-by-step explanation:

The correct conclusion to draw from an official unemployment rate of 10 percent is:

d. 10 percent of the labor force is unemployed.

To calculate the unemployment rate, we divide the number of unemployed persons by the number of persons in the labor force. Therefore, a 10 percent unemployment rate means that 10 percent of the labor force is unemployed.