If cyclical unemployment is eliminated in the economy,then
A)the economy is considered to be at full employment.
B)the unemployment rate is below the natural rate of unemployment.
C)the unemployment rate is above the natural rate of unemployment.
D)the economy is at less than full employment.

Question

Quizplus · Accepted Answer

Cyclical unemployment refers to unemployment caused by fluctuations in the business cycle. If it is eliminated, it means that all the other types of unemployment (frictional and structural) still exist, but the economy is no longer experiencing a downturn. Therefore, the economy is considered to be operating at full employment.

If Cyclical Unemployment Is Eliminated in the Economy,then