When an Individual Is Frictionally Unemployed, the Unemployment Arises in Part

question 368

Multiple Choice

When an individual is frictionally unemployed, the unemployment arises in part from

• A) individuals searching for appropriate employment.
• B) a short- term elimination of jobs because of a slowdown in business activity.
• C) a reduction in the overall demand for workers' skills.
• D) the permanent elimination of jobs because of a change in the structure of the economy.

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Definitions:

Economic Profit

The difference between a firm's total revenue and its total costs, including both explicit and implicit costs, reflecting the real profitability of the business.

Loss

The result of a company or individual spending more money than they receive.

Equilibrium

An equilibrium in the market where demand equals supply, causing price stability.

Kinked-demand Model

A model used to explain price stability in oligopolistic markets, suggesting that firms may not change their pricing in response to small changes in costs or demand due to a perceived kink in the demand curve.