Chapter 20, Problem 20.1.1RQ

To determine

Measurement of unemployment and conditions for a person to satisfy the criteria of being unemployed.

Explanation of Solution

Measurement of unemployment rate:

The U.S. Bureau of census collects data using household survey on monthly basis to calculate the unemployment rate of each month.

Mathematically, unemployment rate is calculated as follows:

$\text{Unemployment rate}=\frac{\text{Number of unemployed}}{\text{Labor force}}\times 100$

Following are the conditions that satisfy the criteria for an unemployed:

1. 1. All people who are available for work but not actively looking for jobs.
2. 2. All people who are doing part-time jobs but wanted to be in full-time jobs.

Economics Concept Introduction

Concept introduction:

Unemployment rate: The unemployment rate is defined as the percentage of labor force that is unemployed.