Frictional unemployment increases when
A) real GDP decreases and the unemployment rate rises.
B) discouraged workers drop out of the work force.
C) workers are replaced by machines and the unemployed workers do not have the skills to perform new jobs.
D) the number of workers who quit one job to find another increases.

Question

Quizplus · Accepted Answer

Frictional unemployment occurs when workers are between jobs, such as when they quit one job to look for another. Therefore, when the number of workers who quit one job to find another increases, frictional unemployment increases. Option A is incorrect because real GDP decreasing and unemployment rate rising is indicative of cyclical unemployment, not frictional. Option B refers to discouraged workers, which is a different type of unemployment, and not related to frictional unemployment. Option C refers to technological unemployment, which is also a different type of unemployment, and not related to frictional unemployment.

Frictional Unemployment Increases When