Question

1 a.Suppose a certain country (country A) has an unemployment rate of 5.3 percent and a labor participation rate of 67.9 percent. There are 37,999,448 people employed in the country. Find the number of people who are unemployed, the number of people in labor force, and the adult population of this country. b. Suppose another country (country B) has an adult population of 77,170,888 people, 48,126,554 of whom are consider to be in the labor force and 35,686,551 of whom are actually employed. Find the labor force participation rate and the unemployment rate of country B. c. Now suppose Country B has an additional 4.9 million who would like to work, but have essentially dropped out because they have been discouraged by the prospects of ever finding a job. Taking these adults into consideration, what would be the actual unemployment rate of Country B.

Answer 1

unemployment rate = (1-employment rate)%

Thus, employment rate = 94.7%

Employment Rate = no. of people employed/total labour force

94.7% = 37,999,448/labour force

labour force = 37,999,448/0.947 = 40,126,133

no. of unemployed people = %of unemployment * total labour force = (5.3/100*40,126,133) = 2,126,685

adult population = labour force/participation rate

= 40,126,133/0.679 = 59,095,924

Unemployment rate in B = no. of people unemployed/labour force = (48,126,554-35,686,551)/48,126,554 = 25.8%

participation rate = labour force/adult population

= 48,126,554/77,170,888 = 62.363%

C. actual unemployment rate = no. of people not finding jobs/total labour force.

= 17,340,003/53,026,554 = 32.7%