- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 11. Understanding Business Cycles
- Subject 6. Unemployment
CFA Practice Question
Suppose there are 2,500 people in the nation of Utopia. Of the people over 16 years old, 1,800 are employed, 200 are unemployed and looking for work, and 200 are unemployed and are not looking for work. The unemployment rate in Utopia is ______.
A. 10%
B. 11.11%
C. 16%
Explanation: The people not in the work force (the 200 unemployed who are not looking for a job) are not accounted for as being unemployed. They are discouraged workers who have left the workforce. The unemployment rate is 200/2000 = 0.1 or 10%.
User Contributed Comments 3
| User | Comment |
|---|---|
| moma20 | 2000 because 1800 are employed +200 are unemployed |
| ambar | unemployment rate = (number of unemployed but looking/labor force)*100 Here, number of unemployed but looking = 200 labor force = 2000 So, unemployment rate = 200/2000 *100 = 10% |
| ColonelCFA | damn i made a dumb mistake |