Government policies such as unemployment compensation and government regulations related to hiring and firing employees result in ________ unemployment.
A) lower frictional
B) lower structural
C) higher frictional
D) lower cyclical
E) higher structural

Question

Quizplus · Accepted Answer

The government policies mentioned in the question create higher frictional unemployment because they make it easier for individuals to stay unemployed for longer periods of time (unemployment compensation) and make it more difficult for businesses to hire and fire employees (regulations). This results in individuals being unemployed for longer periods of time and businesses having a harder time finding qualified employees, leading to higher frictional unemployment.

Government Policies Such as Unemployment Compensation and Government Regulations Related