Unemployment is given by ________ and the natural rate of unemployment is ________.

Question

Quizplus · Accepted Answer

Unemployment is comprised of three main components: frictional, structural, and cyclical. Therefore, option A correctly represents these three components as the total unemployment rate. The natural rate of unemployment, on the other hand, refers to the sum of frictional and structural unemployment, as cyclical unemployment is considered temporary and not part of the natural rate. Therefore, option A correctly identifies the natural rate of unemployment as frictional plus structural unemployment.

Unemployment Is Given by ________ and the Natural Rate of Unemployment