Which of the following statements about full employment is correct? I. Full employment means that the unemployment rate is less than 1/2 of 1 percent.
II) Full employment means that the transaction costs associated with getting a job are zero.
A) I only
B) II only
C) Both I and II
D) Neither I nor II

Question

Quizplus · Accepted Answer

Full employment does not imply an unemployment rate as low as less than 1/2 of 1 percent, nor does it mean that transaction costs associated with getting a job are zero. Full employment refers to the level of employment reached when there is no cyclical or deficient-demand unemployment, typically allowing for some level of natural unemployment to exist due to factors like frictional and structural unemployment.

Which of the Following Statements About Full Employment Is Correct