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

Question

Quizplus · Accepted Answer

Cyclical unemployment refers to the unemployment that occurs due to fluctuations in the business cycle. If the cyclical unemployment rate is greater than zero, it means that there are unemployed workers who cannot find jobs due to a lack of demand in the economy. Therefore, the economy is operating at less than full employment.

If the Cyclical Unemployment Rate Is Greater Than Zero, Then