Principles of Macroeconomics / Unit 5 MAC 0404 short lesson, about 20 seconds
The Unemployment Rate
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The idea
The unemployment rate is the unemployed as a percentage of the labor force, not of the whole population.
In practice
Divide the unemployed by the employed plus the unemployed.
Where people slip
Dividing by the adult population instead is the most common arithmetic error here, and because that population is larger it always understates the rate.
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