Question

Suppose there are a large number of men who used to work or seek work who now no longer do either. Other things the same, this makes a. the number of people unemployed rise but does not change the labor force. b. the number of people unemployed rise but makes the labor force fall. c. both the number of people unemployed and the labor force fall. d. the number of people unemployed fall but does not change the labor force.

Answer 1

Answer: c. both the number of people unemployed and the labor force fall.

Step-by-step explanation:

Unemployed people in an economy refers to those who do not have work but are actively seeking work. As the men above who did not have work are no longer seeking it, they do not qualify to be classified as unemployed any longer which would lead to a fall in the unemployment rate.

The labor force includes both unemployed and employed people in the economy. As the number of people who were classified as unemployed has reduced, so also will the labor force.