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If Cyclical Unemployment Is Zero,the Economy Is

Question 126

Multiple Choice

If cyclical unemployment is zero,the economy is


A) Outside the production possibilities curve.
B) Inside the production possibilities curve.
C) On the fixed production possibilities curve.
D) On the production possibilities curve that shifts inwarD.At the natural rate of unemployment (frictional + structural) ,the economy is on the production possibilities curve.This is also where cyclical unemployment is zero.If cyclical unemployment is above zero,the economy moves inside the production possibilities curve.

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