The natural unemployment rate
I. occurs when only there is no cyclical unemployment present.
II. is the unemployment rate when the economy is at potential GDP.
A) I only.
B) II only
C) neither I nor II
D) I and II

Question

Quizplus · Accepted Answer

The natural unemployment rate occurs when the economy is free from cyclical unemployment, meaning it's at a level consistent with a healthy economy, typically when the economy is at its potential GDP. Both statements I and II accurately describe aspects of the natural unemployment rate.

The Natural Unemployment Rate