When the Economy Slows Down and Real GDP Falls, the Type

question 78

Multiple Choice

When the economy slows down and real GDP falls, the type of unemployment that will be directly affected is the:

• A) natural rate of unemployment.
• B) cyclical unemployment.
• C) frictional unemployment.
• D) structural unemployment.

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Definitions:

External Benefits

Advantages or positive effects that extend to parties not directly involved in a transaction or activity.

Competitive Market

A market scenario where there are many buyers and sellers, and no single entity has the power to significantly influence the prices of goods and services.

Resource Allocation

The process of distributing available resources among various competing needs or uses in an effort to achieve maximum efficiency or to accomplish specific objectives.