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Q 1: Suppose an economy has 10,000 people who are not working but looking and availablefor work and 90,000 people who are working. What is its unemployment rate?Solution: According to Rittenberg & Tregarthen (2009), the unemployment rate is “the percentage of the labor force that does not have any job, unemployed people.” The total number of the labor force, which includes the persons who are employed or who are unemployed and looking for a job (Rittenberg & Tregarthen, 2009).Unemployed = 10,000 ...(peoples do not have jobs)Employed = 90,000 ...(peoples who have jobs)Equation:Unemployment rate = unemployed / (employed + unemployed)Unemployment rate = 10,000 / (90,000 + 10,000)= 10,000 / 100,000 = 10% Answer: Therefor, the unemployment rate is 10%.Q2 A: Now suppose 4,000 of the people looking for work get discouraged and give up their searches. What happens to the unemployment rate?Solution: According to Rittenberg & Tregarthen (2009), discouraged workers are“People who give up their job search are called discourage workers; It means that they were searching before, but because of no luck may be continuous, they become discouraged”. These