ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Everyone who wants to work is working
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The economy is producing at its potential
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The economy is only experiencing cyclical unemployment
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The economy is producing beyond the PPF The economy is producing beyond the PPF
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Detailed explanation-1: -Answer and Explanation: The correct answer is d. Sometimes the actual unemployment rate is below the natural rate. The natural rate of unemployment is the sum of structural and frictional unemployment.
Detailed explanation-2: -The answer is B. The unemployment rate is equal to the natural rate of unemployment. Economists suggest that the economy is at full employment when the cyclical unemployment rate is equal to zero.
Detailed explanation-3: -The natural rate of unemployment is de-fined simply as the rate of unemployment that is compatible with a steady inflation rate. The natural rate can therefore be thought of as the rate of unemployment that would occur in the absence of cyclical fluctuations.
Detailed explanation-4: -Natural unemployment contains three components: structural unemployment, surplus unemployment, and frictional unemployment.