Which of the following is true about the natural rate of unemployment? A. It can vary over time B. It is 2 percent or less of the civilian labor force. C. It is equal to the structural unemployment rate D. It allows for some frictional and cyclical unemployment. E. It is the full-employment rate minus the cyclical and frictional unemployment rate.

Question

Social Studies

Lewis Aguirre

21 May, 16:54

Which of the following is true about the natural rate of unemployment? A. It can vary over time B. It is 2 percent or less of the civilian labor force. C. It is equal to the structural unemployment rate D. It allows for some frictional and cyclical unemployment. E. It is the full-employment rate minus the cyclical and frictional unemployment rate.

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Answers (1)

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Krista Mcconnell · Answer 1

Option D

Explanation:

From the calculation of natural unemployment rate, it is the addition of frictional rate and structural rate, then divided by total labor force. it does nit include cyclical unemployment rate.

Options that have cyclical unemployment rate is wrong, because it does not involve cyclical rate., it is not always 2% or less of civilian labor force because it is not all cases., and it is not structural rate because from the formula is it the combination of structural and frictional divided by total labor force. this makes options D the rate answer.