Question

Suppose 500 people were surveyed, and of those 500,450 were working full time. Of the 50 not working, 10 were full-time college students, 18 were retired, 5 were under 16 years of age, 7 had stopped looking for work because they believed there were no jobs for them, and 10 were actively looking for work. a. How many of the 500 surveyed are in the labor force? b. What is the unemployment rate among the 500 surveyed people?

Short answer

Answer: The unemployment rate among the 500 surveyed people is 2.17%.

Step-by-step solution

Understanding the labor force and unemployment rate definitions.

The labor force refers to the total number of people who are employed or are actively looking for work, excluding people who are not seeking employment, like retired, full-time students, etc. The unemployment rate is the percentage of the labor force that is actively looking for work but is not employed.

Part a. Calculate the number of people in the labor force.

To find the number of people in the labor force, we will consider those who are working full-time, as well as those who are actively looking for work. According to the survey, 450 people are working full-time, and 10 are actively looking for work. So, the labor force is 450 + 10 = 460 people.

Part b. Calculate the unemployment rate among the 500 surveyed people.

Now that we know the labor force (460 people), we can calculate the unemployment rate by dividing the number of people actively looking for work (10 people) by the number of people in the labor force (460 people): Unemployment rate = (number of people actively looking for work) / (labor force) Unemployment rate = (10) / (460) Unemployment rate = 0.0217 To express it as a percentage, we multiply the result by 100: Unemployment rate = 0.0217 * 100 = 2.17 % The unemployment rate among the 500 surveyed people is 2.17 %.