Question

4. The official unemployment rate understates the unemployment level in the economy because the official unemployment rate:

A. ignores the duration of unemployment.

B. ignores underemployed and discouraged workers.

C. includes jobs created by the underground economy.

D. excludes all unemployed teenagers.

E. excludes frictional unemployment.

Answer 1

NO A. ignores the duration of unemployment.

YES B. ignores underemployed and discouraged workers.

NO C. includes jobs created by the underground economy.

NO D. excludes all unemployed teenagers.

NO E. excludes frictional unemployment.