Which of the Following Statements About Discouraged Workers Is Correct

question 54

Multiple Choice

Which of the following statements about discouraged workers is correct?

• A) Because of the existence of discouraged workers, the reported unemployment rate generally understates the true level of unemployment in an economy.
• B) The unemployment rate rises when those no longer looking for work are no longer counted as unemployed.
• C) People who are still looking for work and have been unemployed for longer than four weeks are classified as having dropped out of the labor force rather than as being unemployed.
• D) None of the above statements is correct.

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Definitions:

Investee

An entity in which an investor holds an interest, where the investor has significant influence but not full control or ownership.

Periodic Net Income

The profit or loss reported by a company at the end of a specific accounting period, reflecting all revenues and expenses.

Trading Securities

Financial assets that a company buys and sells with the intention of making a profit in the short term.

Debt Securities

Notes and bond investments that provide interest revenue over a fixed maturity.