The natural rate of unemployment is generally thought to be the sum of ?
Correct answer: C. frictional unemployment and structural unemployment
- A. frictional unemployment and seasonal unemployment
- B. frictional unemployment and cyclical unemployment
- C. frictional unemployment and structural unemployment
- D. cyclical unemployment and structural unemployment
Explanation
The natural rate includes unemployment that remains even when the economy is operating normally: frictional unemployment from job search and structural unemployment from skill or industry mismatches. Cyclical unemployment is excluded because it results from recessions.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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