Which of the following would be likely to lead to a decrease in the natural rate of unemployment?
A) an increase in the number of teenage workers in the workforce
B) a decrease in the length of time during which people can receive unemployment benefits
C) a prolonged recession
D) all of the above

Question

Quizplus · Accepted Answer

Option A would not lead to a decrease in the natural rate of unemployment, as teenage workers are typically included in the calculations for the natural rate. Option C would likely increase the natural rate of unemployment. Option B would lead to a decrease in the natural rate of unemployment, as it would reduce the incentive for people to remain out of work and would encourage them to find employment sooner.

Which of the Following Would Be Likely to Lead to a Decrease