Total population 20000 Workingage population Employment Unem

Total population 20,000 Working-age population Employment Unemployment 15,000 10,000 1000 Consider the data above for a simple economy 1) What is the unemployment rate for this simple economy? 2) What is the labor force participation rate for this simple economy? 3) Suppose the working-age population of a fictional economy falls into the following categories: 90 are retired or homemakers: 60 have full-time employment; 20 have part-time employment, 20 do not have employment, but are actively looking for employment, and 10 would like employment but do not have employment and are not actively looking for employment. The official unemployment rate as calculated by the U.S. Bureau of Labor would equa

Solution

Q.1)
Unemployment rate = Unemployed/ Labor force
Labor force = (Unemployed + Employed)
Unemployment rate = 1000/(1000+10000) = 9.09 percent
Q.2)
Labor force participation rate = Labor force/adult population = (11000/15000)*100 = 73.33 percent
Q.3)
Labor force = (60+20+20) = 100
Unemployment rate = (20/(100))*100 = 20 percent