The natural rate of unemployment is the a. unemployment rate that would prevail
ID: 1104778 • Letter: T
Question
The natural rate of unemployment is the a. unemployment rate that would prevail with zero inflation. b. rate associated with the highest possible level of GDP c. difference between the long-run and short-run unemployment rates. d. amount of unemployment that the economy normally experiences. Cyclical unemployment refers to a the relationship between the probability of unemployment and a worker's changing level b. c. d. of experience. how often a worker is likely to be employed during her lifetime. year-to-year fluctuations of unemployment around its natural rate due to recessions. long-term trends in unemployment.Explanation / Answer
1. The Natural rate of unemployment is the unemployment that does not go away on its own Even in the long run. It is the amount of unemployment that the economy normally experiences.
Answer - Option D
2) Cyclical unemployment is the short term ups and downs of the business cycle. It refers to the year to year fluctuations of unemployment around its natural rate due to recession.
Answer- option C