Suppose that some country had an adult population of about 50 million, a labor-force participation rate of 60 percent, and an unemployment rate of 5 percent. How many people were employed?

Question

a. 30 million
b. 28.5 million
c. 47.5 million
d. 1.5 million

Answer 1

To find out how many people were employed, we can follow these steps:

1. Calculate the labor force: The labor force is the portion of the adult population that is either working or actively looking for work.

   \[ \text{Labor Force} = \text{Adult Population} \times \text{Labor-Force Participation Rate} \] \[ \text{Labor Force} = 50,000,000 \times 0.60 = 30,000,000 \]

2. Calculate the number of unemployed: The unemployment rate tells us the percentage of the labor force that is unemployed.

   \[ \text{Number of Unemployed} = \text{Labor Force} \times \text{Unemployment Rate} \] \[ \text{Number of Unemployed} = 30,000,000 \times 0.05 = 1,500,000 \]

3. Calculate the number of employed: The total number of employed can be found by subtracting the number of unemployed from the labor force.

   \[ \text{Number of Employed} = \text{Labor Force} - \text{Number of Unemployed} \] \[ \text{Number of Employed} = 30,000,000 - 1,500,000 = 28,500,000 \]

Thus, the number of employed people is 28.5 million.

The answer is b. 28.5 million.