The Unemployment Rate Will Understate the True Amount of Unemployment

question 54

Multiple Choice

The unemployment rate will understate the true amount of unemployment if

• A)the unemployment rate is rising.
• B)crime,divorce,and social unrest are all positively correlated with unemployment.
• C)the official unemployment figure excludes discouraged workers who have stopped actively looking for work.
• D)the labour force has grown more rapidly than output.
• E)the actual unemployment rate is greater than the natural rate of unemployment.

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Definitions:

Savings

Money that has been set aside and saved, typically in a bank account, for future use or emergencies.

Account

A record summarizing all the transactions pertaining to a single item in the accounting equation.

Monthly

Occurring or being calculated on a monthly basis; often used in the context of payments, interest calculations, or reporting periods.

Compounded Quarterly

An interest calculation method where the accrued interest is added to the principal four times a year, increasing the amount on which future interest is computed.