Suppose a huge number of people in the US decide to claim disability insurance and are...

Suppose a huge number of people in the US decide to claim disability insurance and are successful at doing so.

What is the likely effect on the unemployment rate?

Increase
Decrease
Unchanged
Unclear
None of the above

Solutions

Expert Solution

Unemployment rate is the ratio of number of people unemployed to the labour force .

labour force is the sum of employed people and unemployed peoples .

unemployed peoples are those who are actively looking for work in last 4 weeks and comes under the working age population.

so if a huge number of people are successful in claiming the disability insurance ,it means people will not focused towards finding more work and remains unemployed .

It will increase the unemployment rate because there are already get funding of the insurance from the government .

so the answer is option A

Rahul Sunny answered 2 years ago

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