Which of the following is true?
A)At the natural rate of unemployment, the economy is considered to be at full employment.
B)At full employment, the economy is producing at its potential output.
C)If unemployment is greater than its natural rate, the economy is producing at less than its potential output.
D)If we are at less than full employment, some cyclical unemployment exists.
E)All of the above are true.

Question

Quizplus · Accepted Answer

All the statements are true: A) The natural rate of unemployment includes only frictional and structural unemployment, indicating full employment. B) Full employment means the economy is at potential output. C) Unemployment above the natural rate suggests underutilization of resources. D) Less than full employment implies cyclical unemployment.

Which of the Following Is True