Question

During a recession, a number of workers have their hours reduced by their employers. All else the same, the unemployment rate will ________ and the labor force participation rate will ________.

Answer 1

Answer:

The answers in this case are will remain unchanged and will remain unchanged respectively.

Explanation:

• In this case,due to a recession the overall hours of work worked by individual employees or staff are reduced by the employers.
• Now,note that it has been mentioned that everything else or every other factor or component in the economy is constant in the economy and thus,unaffected by the recession.
• Therefore,it can be reasonably assumed that the unemployment rate will remain the same as there has not been any worker expulsion or layoffs as a result of the recession based on the information provided in the question.
• Furthermore,the labor force participation will also presumably remain unchanged as there has been no change in the existing working or employed labor force and/or in the overall population level based on the information presented.