Question

assume that the natural rate of unemployment is 5%. in how many of the years after the onset of the great depression did the united states experience cyclical unemployment greater than 10% (hint: only look at the rate at the beginning of each year)?

Answer 1

From 1931 until 1940, the United States experienced cyclical unemployment rates over 10% at the beginning of each year, following the start of the Great Depression.

Assuming that the natural rate of unemployment is 5%,

To evaluate the prevalence of cyclical unemployment greater than 10% after the onset of the Great Depression,

we need to look at the unemployment rates beginning each year following the Great Depression, which started in 1929.

During the 1930s, the United States experienced some of the highest rates of unemployment in its history.

Notably, from 1931 until 1940, the unemployment rates at the beginning of each year were well above 10%, indicating a period of significant cyclical unemployment caused by the economic downturn.

The years when the unemployment rate exceeded 10% were 1931, 1932, 1933, 1934, 1935, 1936, 1937, 1938, 1939, and 1940.