Economists define full employment as the level of employment that results when
a. the economy is in an economic boom.
b. the rate of unemployment is zero.
c. the rate of unemployment has fallen to its historical low of approximately two percent.
d. the rate of unemployment is normal, considering both frictional and structural factors.
D
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In the long run, monopolistically competitive firms make zero economic profits because of government regulations
Indicate whether the statement is true or false
Which of the following is TRUE about exchange rates?
A) They should not be volatile because they will determine the economic climate. B) They are generally more volatile than stock prices. C) They are more volatile than several underlying factors that move them such as money supplies and fiscal variables. D) They should be volatile because to correct price signals they adjust quickly in response to economic news, but they are generally less volatile than stock prices. E) They never overreact to economic news.