1. Recent data for the U.S. reveal the following (all figures in millions). 307.

Question

1. Recent data for the U.S. reveal the following (all figures in millions). 307.0 69.3 139.1 14.6 Total population nder 16 or institutionalized Employed Unemployed Use the data to find the following a. The size of the labor force. b. The number classified as "not in the labor force." c. The unemployment rate. 2. The Bureau of Labor Statistics reported the CPI stood at 215.9 in December 2009, while one year earlier it was 210.2. a. What was the annual rate of inflation measured from December to December? b. At this rate of inflation, approximately how long will it take for the price level to double?

Explanation / Answer

1.

A.

Size of the labor force = employed + unemployed = 139.1 + 14.6 = 153.7 Million

B.

Number classified as not in the labor force = Total population – labor force = 307-153.7

Number classified as not in the labor force = 153.3 Million

C.

Unemployment rate = unemployed/labor force = 14.6/153.7 = 9.499%

2.

A.

Annual rate of inflation = (215.9-210.2)/210.2 = 2.71%

B.

Let, n years take to double the inflation,

then,

2 = 1*(1+2.71%)^n

n= log2/log1.0271

n = 25.92 years

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