Classifying discouraged workers as unemployed would ?
Correct answer: C. increase the unemployment rate
- A. not change the unemployment rate
- B. decrease the unemployment rate
- C. increase the unemployment rate
- D. have an indeterminate impact on the unemployment rate
Explanation
Discouraged workers are normally outside the labour force, so counting them as unemployed adds them to both unemployment and the labour force. Since the unemployment rate is normally below 100 percent, this raises the measured rate.
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