Question

Use the following information about the town of? Boone, NC to answer the next few questions. Suppose Boone has a total population of? 25,000 people. There are? 18,000 people who currently have a job. Another? 3,000 people do not have a job but are currently looking for one. Of those? 3,000 people, 500 of them recently quit and are looking for a job that suits their? skill-set, 1,000 of them were recently replaced by new machinery at the local ski? resorts, and the remaining? 1,500 were laid off due to a recent downturn in the economy? (but are currently looking for a? job). Additionally, another 500 people were recently laid off due to a downturn in the? economy, but these people gave up looking for work about 3 months ago due to economic reasons.? Last, there are? 1,000 people under age 16 and? 2,500 full-time students in the town of Boone. What is the unemployment rate in? Boone?

Answer 1

Boone has a total population of? 25,000 people.

There are? 18,000 people who currently have a job = Total employed

Another? 3,000 people do not have a job but are currently looking for one. Of those? 3,000 people, 500 of them recently quit and are looking for a job that suits their? skill-set = Frictionaly unemployed

1,000 of them were recently replaced by new machinery at the local ski? resorts = structurally unemployed

Rremaining? 1,500 were laid off due to a recent downturn in the economy? (but are currently looking for a? job) = Cyclically unemployed

Another 500 people were recently laid off due to a downturn in the? economy, but these people gave up looking for work about 3 months ago due to economic reason = Discouraged workers

Last, there are? 1,000 people under age 16 and? 2,500 full-time students in the town of Boone = Non working population

This implies labor force = 25000 - 1000 - 2500 = 21500. Out of this labor force 18000 is working and 3500 is not working. Out of this only 3000 are looking for job. Hence unemployed = 3000 and labor force = 21500 - 500 = 21000 (subtract discouraged workers)

Unemployment rate = Unemployed*100/labor force = 3000*100/21000 = 14.29%.