Which of the following does NOT occur in an economy experiencing full employment?
A)underemployment
B)cyclical unemployment
C)structural unemployment
D)frictional unemployment

Question

Quizplus · Accepted Answer

Full employment refers to a situation where all those who are willing and able to work at the prevailing wages rate have employment. Cyclical unemployment occurs due to fluctuations in the business cycle, where job loss occurs because of a decrease in aggregate demand. However, in full employment, there is no cyclical unemployment, and it is not a characteristic of a full employment economy. Underemployment, structural, and frictional unemployment may still occur in a full employment economy.

Which of the Following Does NOT Occur in an Economy