Question 1: Suppose there are 2,000 unemployed persons in our economy and a labor force of 100,000. What is the unemployment rate?
Question 2: Suppose that 1,000 married people become unemployed during a recession, and all of their spouses enter the labor force and find jobs. Now what is the unemployment rate? How does it compare to the previous unemployment rate in part a.? Hint: Think about the formula for the unemployment rate, and recall that UE/LF = UE/(E + UE).