Question

. Types of unemployment The three people described in the following table are categorized as unemployed by the Bureau of Labor Statistics. Identify each person in the table as structurally, frictionally, or cyclically unemployed. Unemployment Type Structural Frictional Cyclical Kyoko is a real estate agent. House sales in her area have declined because the region has been going through a recession. She has no clients and is currently looking for a new full-time job. Eleanor just moved with her husband to Portland, Oregon. She's looking for a job as a paralegal. Darnell recently lost his job as a dishwasher. Minimum-wage legislation keeps employers from adding more of the low-skill positions for which he qualifies, so he has been unable to find work. The following table shows data on frictional, cyclical, structural, and total unemployment for an economy. Unemployment Type Rate (Percent) Frictional 3.0 Cyclical 0.0 Structural 1.0 Total unemployment 4.0 True or False: This economy is not currently at its natural rate of unemployment. True False

Answer 1

Cyclically unemployed

Frictionally unemployed

Structurally unemployed

False

Step-by-step explanation:

Cyclical unemployment is unemployment as a result of business cycles. Unemployment rises during a recession and falls during a boom. Kyoko is cyclically unemployed.

Frictional unemployment is when a person is unemployed from the time she leaves her employment and the time she gets another one. Eleanor is frictionally unemployed.

Structural unemployment is when there's a mismatch between the skills of labour and the available jobs. Darnell is structurally unemployed.

A country is at its natural rate of unemployment if cyclical unemployment is equal to zero. Therefore, natural unemployment is equal to the sum of frictional and structural unemployment. Natural unemployment is 4% . The economy is at its natural rate of unemployment.

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