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Macroeconomics

Lesson 3: Unemployment

Types of unemployment and the natural rate of unemployment

AP.MACRO: MEA‑1 (EU), MEA‑1.E (LO), MEA‑1.E.1 (EK), MEA‑1.E.2 (EK), MEA‑1.E.3 (EK), MEA‑1.E.4 (EK)

Which of the following best describes the concept of the natural rate of unemployment?

(Choice A)
The unemployment rate that is associated with producing the full-employment level of output
(Choice B)
The amount of unemployment that exists when producing inside its production possibility curve (PPC)
(Choice C)
When the unemployment rate is equal to zero
(Choice D)
The unemployment that exists due to changes in nature, such as changing from summer to winter
(Choice E)
The amount of unemployment that exists when producing outside its production possibility curve (PPC)