If the number of discouraged searchers increases, everything else remaining the same, then the Answers: employment...

If the number of discouraged searchers increases, everything else remaining the same, then the

Answers:	employment rate decreases.
	unemployment rate increases.
	labour force participation rate decreases.
	labour force participation rate increases.
	employment rate increases.

Solutions

Expert Solution

LF=Employed+ Unemployed

Unemployment rate= (unemployed / LF)*100

Labor force participation rate= (Labor Force/ adult population)*100

Since adult population is also known as the civilian non-institutional population

Hence labor force participation rate is the ratio of the labor force and the civilian non-institutional population.

LF=Employed + unemployed + Part-time employed

Unemployment rate= (unemployed / LF)*100

The discouraged workers are those workers who have stopped searching for work, by remaining unemployed for many months.

Hence when the unemployment rate increases, then few of them will stop searching job, after trying many times. Hence they will leave labor force. Therefore labor force decreases.

Hence the labor force participation rate will tend to fall.

Hence it can be said that If the number of discouraged searchers increases, everything else remaining the same, then the labour force participation rate decreases.

Hence option third is the correct answer.

Rahul Sunny answered 1 year ago

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