Suppose that unemployment increases because the government requires employers to provide more funds for their employees' retirement programs. The increase in unemployment is most likely a result of an increase in
A) frictional unemployment.
B) structural unemployment.
C) the natural rate of unemployment.
D) cyclical unemployment.

Question

Quizplus · Accepted Answer

Mandating more funds for retirement programs would increase labor costs for employers, causing them to potentially lay off workers or hire fewer workers. This suggests a structural change in the labor market, as the cost of hiring has increased and certain jobs may no longer be seen as financially viable for businesses to maintain.

Suppose That Unemployment Increases Because the Government Requires Employers to Provide