If the cyclical unemployment rate is negative,then the
A)economy is operating beyond full employment.
B)economy is operating at less than full employment.
C)frictional unemployment rate is negative.
D)frictional unemployment rate is greater than the structural unemployment rate.
E)real-wage unemployment rate is negative.

Question

Quizplus · Accepted Answer

Cyclical unemployment refers to the unemployment caused by downturns or recessions in the economy. When the cyclical unemployment rate is negative, it means that the actual unemployment rate is lower than the natural or potential rate of unemployment, which is the rate that exists when the economy is operating at full employment. This implies that the economy is operating beyond full employment, with a labor shortage and potentially rising inflation and wages.

If the Cyclical Unemployment Rate Is Negative,then the