Full employment occurs
A) only if the unemployment rate is equal to the natural unemployment rate.
B) only if unemployment is equal to structural unemployment plus cyclical unemployment.
C) only if the unemployment rate is zero.
D) None of the above answers are correct.

Question

Quizplus · Accepted Answer

Full employment occurs when the unemployment rate is equal to the natural unemployment rate, which is the rate of unemployment that exists when the economy is producing at its potential level of output and there is neither cyclical nor frictional unemployment. Therefore, choice A is the best answer.

Full Employment Occurs