Full employment occurs
A) only if the unemployment rate is zero.
B) only if the unemployment rate is equal to the natural unemployment rate.
C) only if unemployment is equal to structural unemployment plus cyclical unemployment.
D) None of the above answers are correct.
B
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A firm increases its output and its average total costs remain unchanged. Is the firm experiencing increasing returns to scale, constant returns to scale, or decreasing returns to scale?
What will be an ideal response?
Steady-state investment per worker is positively related to the capital—labor ratio because the higher the capital—labor ratio
A) the lower the capital depreciation rate. B) the greater the amount of resources available for capital investment. C) the more investment per worker is required to replace depreciating capital. D) the less the economy needs to equip new workers with the same high level of capital.