Which of the following would likely lead to an increase in the natural rate of unemployment?
A) an increase in the number of teenagers in the workforce
B) an increase in the length of time during which people can receive unemployment benefits
C) a prolonged recession
D) all of the above

Question

Quizplus · Accepted Answer

A) An increase in the number of teenagers in the workforce can increase the natural rate of unemployment as they often lack job skills and experience compared to older workers. 
B) An increase in the length of time during which people can receive unemployment benefits can make some workers less motivated to find a job and more willing to remain unemployed, increasing the natural rate of unemployment. 
C) A prolonged recession can lead to a reduction in job opportunities and higher levels of long-term unemployment, thus increasing the natural rate of unemployment. Therefore, all of the above factors can lead to an increase in the natural rate of unemployment.

Which of the Following Would Likely Lead to an Increase