During a Recession, People Drop Out of the Labor Force

question 314

Multiple Choice

During a recession, people drop out of the labor force because they are unable to find a job. All else the same, this

• A) increases the official U-3 unemployment rate.
• B) increases the official U-3 unemployment rate and the labor force participation rate.
• C) does not change the official U-3 unemployment rate.
• D) decreases the official U-3 unemployment rate.

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Definitions:

Seasonal Factors

Components or influences that cause regular and predictable changes or patterns in data or business activity corresponding to specific seasons or times of the year.

Seasonal Pattern

A recurring fluctuation or trend in data over specific periods of time, often related to the seasons of the year.

Monthly Index

A monthly index is a statistical measure that tracks changes in a variable, such as prices or economic activity, over time compared to a base period.

Seasonal Index

A statistical measure used to identify and quantify the predictable and recurring fluctuations in demand, sales, or other business metrics within specific periods throughout the year.