When the economy moves into and out of recessions and expansions, the unemployment rate fluctuates around the
A) natural unemployment rate.
B) structural unemployment rate.
C) cyclical unemployment.
D) frictional unemployment rate.

Question

Quizplus · Accepted Answer

The unemployment rate fluctuates around the natural unemployment rate as the economy moves into and out of recessions and expansions. The natural unemployment rate includes both frictional and structural unemployment but excludes cyclical unemployment, which is directly related to the economic cycles of expansion and recession.

When the Economy Moves into and Out of Recessions and Expansions