Which of the following is true?
A)At below the natural rate of unemployment, the economy is considered to be beyond full employment.
B)At above full employment, the economy is producing more than potential output.
C)At above full employment, unemployment would be below its natural rate.
D)All of the above are true.

Question

Which of the following is true?
A)​At below the natural rate of unemployment, the economy is considered to be beyond full employment.
B)​At above full employment, the economy is producing more than potential output.
C)​At above full employment, unemployment would be below its natural rate.
D)​All of the above are true.

Quizplus · Accepted Answer

All statements are correct. At below the natural rate of unemployment, the economy is indeed considered to be beyond full employment, indicating that unemployment is lower than the level at which the economy can sustain without causing inflation. At above full employment, the economy is producing more than its potential output, which can lead to inflationary pressures. Also, when the economy is above full employment, unemployment would be below its natural rate, reflecting a very tight labor market.

Which of the Following Is True