Question

Unemployment Type Rate (Percent) Frictional 3.2 Cyclical 0.0 Structural 1.1 Total unemployment 4.3 True or False: This economy is not currently at its natural rate of unemployment. gs

Answer 1

Answer: False

Step-by-step explanation:

The economy is at its Natural rate of Unemployment when Total Unemployment is the result of only Frictional and structural unemployment because Cyclical Unemployment is as a result of the Economic cycle and so is not counted as part of the natural rate.

Here;

Frictional unemployment (3.2) + Structural Unemployment (1.1) = Total Unemployment (4.3)

This economy is at its Natural rate of unemployment.