How might government policies differ when attempting to reduce the three types of unemployment? Be specific
What will be an ideal response?
If the government is attempting to reduce frictional unemployment, it would need to devise a way to do a better and faster job of matching workers and jobs.
If the government is attempting to reduce structural unemployment, it would need to address the underlying structural problem, such as setting up job training programs for the structurally unemployed.
If the government is attempting to address cyclical unemployment, it would need to find a way to get people to accelerate their own spending or find some way to replace the lost spending, such as increasing government spending.
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Investments are actions that incur costs in the future but provide expected benefits today
Indicate whether the statement is true or false
Suppose that IS and LM intersect at full-employment output. A leftward shift of IS will be followed by a __________ price level that shifts LM to the __________ in a return to full employment
A) rising; right B) rising; left C) falling; right D) falling; left