Which one of the following statements is NOT correct?
A) The natural rate of unemployment is estimated to be between 5 percent and 6.5 percent in the U.S.
B) The term "full employment" means that 100 percent of the labor force is employed.
C) The line between frictional and structural unemployment is sometimes hard to draw.
D) Unemployment can occur even when an economy is growing.

Question

Quizplus · Accepted Answer

"Full employment" does not mean that 100 percent of the labor force is employed. It refers to the lowest rate of unemployment that an economy can sustain without causing inflationary pressures. This rate is often estimated to be around the natural rate of unemployment.

Which One of the Following Statements Is NOT Correct