In the long run, unemployment
I. will be at the natural rate of unemployment.
II. is made up of structural and frictional unemployment.
III. could be made up of structural, frictional, and cyclical unemployment.

Question

In the long run, unemployment 
I. will be at the natural rate of unemployment.
II. is made up of structural and frictional unemployment.
III. could be made up of structural, frictional, and cyclical unemployment.

Quizplus · Accepted Answer

In the long run, the economy should reach the natural rate of unemployment, which includes structural and frictional unemployment. However, cyclical unemployment may also persist in the long run if the economy experiences recurring periods of economic downturns. Therefore, Choice C is the best answer.

In the Long Run, Unemployment