Question

Suppose that the adult population is 210 million, and there are 130 million who are employed and 5 million who are unemployed. Calculate the unemployment rate and the labor force participation rate.

Answer 1

Unemployment rate= 3.7%

Labor force participation rate= 64.3%

Step-by-step explanation:

The adult population is 210 million

The number of unemployed adults is 130 million

The number of unemployed adults is 5 million

(a) Unemployment rate= Number of unemployed/(Number of unemployed+Number of employed)×100

= 5 million/(5 million+130 million) × 100

= 5 million/135 million×100

= 0.037×100

= 3.7%

(b) Labor force participation rate= (Number of employed+Number of unemployed)/Adult population

= (5 million+ 130 million)/210 million

= 135 million/210 million

= 0.643×100

= 64.3%