Answer and Explanation:
The computation of the official unemployment rate is shown below:
Official unemployment rate is
= Unemployed workers ÷ (Unemployed + employed) × 100
= 13,863,000 ÷ (13,863,000 + 139,323,000) × 100
= 9.05%
Now for the U-4 is
= (Unemployed workers + discouraged workers) ÷ (Unemployed + employed + discouraged workers) × 100
= (13,863,000 + $993,000) ÷ (13,863,000 + 139,323,000 + $993,000) × 100
= 9.64%
Therefore for exclduing the discouraged workers it may cause the offical rate to understate the underemployment true extent
