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Consider the following statements.
  1. The labour force participation rate essentially tells what percentage of the total population want to be part of the workforce.
  2. A low labour force participation rate means fewer people are making themselves available for economic activity.
Which of the above statements is/are incorrect?
  • a)
    1 only 
  • b)
    2 only 
  • c)
    Both 1 and 2 
  • d)
    Neither 1 nor 2
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements. The labour force participation rate...
Explanation:

The labour force participation rate is a key indicator that measures the proportion of the working-age population that is either employed or actively seeking employment. It is calculated by dividing the labour force (the total number of employed and unemployed individuals) by the working-age population and multiplying by 100. The labour force participation rate essentially tells us what percentage of the total population wants to be part of the workforce.

Statement 1: The labour force participation rate essentially tells what percentage of the total population want to be part of the workforce.
This statement is correct. The labour force participation rate provides us with information about the proportion of the population that is interested in participating in the labor market. It includes both employed individuals and those who are actively seeking employment.

Statement 2: A low labour force participation rate means fewer people are making themselves available for economic activity.
This statement is incorrect. A low labour force participation rate does not necessarily mean that fewer people are making themselves available for economic activity. Instead, it indicates that a smaller proportion of the working-age population is either employed or actively seeking employment.

Conclusion:
Based on the analysis above, we can conclude that statement 1 is correct, while statement 2 is incorrect. Therefore, the correct answer is option 'A' - 1 only.
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Community Answer
Consider the following statements. The labour force participation rate...
The labour force participation rate essentially tells us what percentage of people who are within the working-age (15 to 59 years) group want to be part of the workforce. A low labour force participation rate undermines a country’s overall productivity and wellbeing because fewer people are making themselves available for economic activity.
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