Question

23 mark for review
an increase in the labor force participation rate will
a increase investment and decrease savings
b increase savings and decrease investment
c have no effect on unemployment
d make it easier to reduce unemployment
e make it more difficult to reduce unemployment

Explanation:

An increase in the labor force participation rate means more people enter the labor market seeking jobs. Even if some find work, the larger pool of job seekers makes it harder to lower the overall unemployment rate, as there are more people now counted in the labor force looking for employment.

Answer:

E. make it more difficult to reduce unemployment