Unemployment that occurs when there is a decline in total spending is called:
A)frictional unemployment.
B)cyclical unemployment.
C)structural unemployment.
D)natural unemployment.

Question

Quizplus · Accepted Answer

Cyclical unemployment is caused by a decline in aggregate demand, which reduces the demand for labor, leading to layoffs and increased unemployment. Frictional unemployment is caused by workers searching for better job opportunities, whereas structural unemployment is caused by shifts in the economy that make certain skills or industries obsolete. Natural unemployment is the sum of frictional and structural unemployment and represents the lowest rate of unemployment that an economy can sustain without inflationary pressures.

Unemployment That Occurs When There Is a Decline in Total