The unemployment rate: a. Always decreases. b. Does not depend on business cycles. c. Increases...

Question:

The unemployment rate:

a. Always decreases.

b. Does not depend on business cycles.

c. Increases during a recession and decreases during an expansion.

d. Decreases during a recession and increases during an expansion.

e. Always increases.

Labor Force:

The labor force is the segment of the population that is legally able to and willing to work. This means that not everyone in the population will be included in the labor force. The labor force can be calculated by adding the number of workers employed with those unemployed and searching for work. Alternatively, you could find the labor force by subtracting everyone underage, or unable or unwilling to work. Unemployed workers who are not actively searching are known as discouraged workers. Economists often calculate the labor force participation rate to evaluate changes in the labor force over time.

Answer and Explanation: 1

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The answer is c. Increases during a recession and decreases during an expansion. The unemployment rate is found by dividing the unemployed workers in...

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Why the Unemployment Rate Decreases and Increases

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Chapter 6 / Lesson 2
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Unemployment rates are an important indicator of the economy. This lesson will explore what defines unemployment, why unemployment rates change, the way unemployment is calculated, and look at the three types of unemployment.


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