Which of the Following Statements About the Natural Rate of Unemployment

question 105

Multiple Choice

Which of the following statements about the natural rate of unemployment is true?

• A)The natural rate of unemployment declined during the 1970s.
• B)An aging labor force causes the natural rate of unemployment to decline.
• C)Economists are able to precisely calculate the natural rate of unemployment.
• D)The natural rate of unemployment has remained constant over the past 30 years.
• E)The term natural in natural rate of unemployment is meant to imply that this is the unemployment rate that the economy should always try to strive for.

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Definitions:

Contribution Margin Ratio

A measure that indicates the percentage of each sales dollar that contributes to covering fixed costs and generating profit.

Target Profit

The amount of net income that a company aims to achieve within a specific time frame.

Fixed Expenses

Costs that remain constant for a given period of time regardless of the level of production or business activity.

Variable Expenses

Costs that vary directly and proportionally with the level of output or sales volume.