If the unemployment rate decreases, it is because: A. Employed workers found jobs B. Unemployed workers left the labor force C. Unemployed workers found jobs D. Employed workers left the labor force E. Both unemployed workers found jobs and unemployed workers left the labor force

If the unemployment rate decreases, it is because:
A. Employed workers found jobs
B. Unemployed workers left the labor force
C. Unemployed workers found jobs
D. Employed workers left the labor force
E. Both unemployed workers found jobs and unemployed workers left the labor force

Answer

• E. Both unemployed workers found jobs and unemployed workers left the labor force
  Explanation:
  Unemployment rate is calculated by dividing the number of unemployed individuals with the number of people in the labor force. Thus, two factors that determines the rate is number of unemployed people and the number of labor force. If the number of unemployed workers decreases, the rate of unemployment will increase, and this may be caused by more unemployed worker finding jobs. Additionally, if more unemployed workers leave the labor force, the number of unemployed will not include the workers out of labor force and hence decline in unemployment rate

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