Which of the following about unemployment is true?
A) The unemployment rates of the major European economies were substantially lower than in the United States during the last decade.
B) High unemployment rates over lengthy time periods are indicative of structural and regulatory factors that are exerting an adverse impact on the natural rate of unemployment.
C) The natural rate of unemployment is unaffected by changes in the age composition of the labor force (for example, an increase in the relative number of youthful workers).
D) Institutional changes such as an increase in the minimum wage may increase cyclical unemployment but will not affect the natural rate of unemployment.

Question

Quizplus · Accepted Answer

High unemployment rates over lengthy time periods indicate structural and regulatory factors that are adversely impacting the natural rate of unemployment. The statement that the unemployment rates of the major European economies were substantially lower than in the United States during the last decade (A) is not necessarily true, as unemployment rates vary by country and can change over time. The natural rate of unemployment (C) can be affected by changes in the age composition of the labor force, as younger or older workers may have different rates of unemployment. Institutional changes such as an increase in the minimum wage (D) can affect both cyclical and natural unemployment.

Which of the Following About Unemployment Is True