Problem
Suppose that in an economy there are 4M people who are unemployed with unemployment insurance, 1M who are unemployed without unemployment insurance, and 5M not looking for a job. The unemployment rate in this economy is 10%. How many people are emploved?
A. 36M.
B. 40M
C. 45M.
D. 50M.
2. Suppose the civilian adult population increased by 2%, the number of unemployed people increased by 3%, and the labor force participation fell by 1%. How much did the unemployment rate change approximately?
3. Suppose that 20 percent of the civilian adult population is not in the labor force, and 70 percent of the adult population is employed.
(a) What is the unemployment rate equal to?
(b) Suppose now that the fraction of the adult population not in the labor force increases to 25 percent, while the employed fraction of the adult population remains unchanged. Does the unemployment rate increase or decrease?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.