AP Macroeconomics Question 286: Answer and Explanation
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5. For Question below use the following information for a small town:
What is the official unemployment rate?
- A. 5 percent
- B. 2.5 percent
- C. 5.5 percent
- D. 7 percent
- E. Unknown, as we do not know the number of discouraged workers
Correct Answer: A
A —The unemployment rate is the ratio of unemployed to the total labor force. UR = U/LF = 50/1,000 = 5%.