Question

Suppose an economy has 10,000 people who are not working but looking and available for work and 90,000 people who are working. What is its unemployment rate?

Answer 1

In the given scenario unemployment rate is 10%

Explanation:

In the given problem,

Number of People who are working is 90,000

Number of People who are not working but looking and available is 10,000

Unemployment rate = Percentage of the total labor force that is unemployed but actively looking for employment and ready to  work.  

Unemployment rate = ((Unemployed people * 100) / (Total people in an economy (Working + Available for work)))

Unemployment rate = ((10000 * 100) / (90000+10000))

Unemployment rate = (1000000 / 100000)

Hence, Unemployment rate = 10%

Answer 2

The rate of the unemployment in this case is 10%.

Explanation:

The unemployment rate is estimated by dividing the economically active unemployed populace looking for business divided by the complete financially active populace.

In this case, it is calculated by dividing the number of people who are not working which is 10000 with the addition of number of people working and number of people looking for job. This comes out to be 10% which is the unemployment rate.