If the Actual Unemployment Rate Is Less Than the Natural

question 49

Multiple Choice

If the actual unemployment rate is less than the natural rate of unemployment,then

• A) the economy is in an expansionary phase.
• B) cyclical unemployment is rising.
• C) frictional unemployment is rising.
• D) structural unemployment is rising.
• E) This is not possible.

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Definitions:

Potential Competitors

Firms or individuals that are not currently in the market but have the ability to enter and compete in the future.

Oligopolistic Industry

A market structure characterized by a small number of firms dominating the market, leading to strategic interactions in pricing and output.

Economic Efficiency

A situation where the distribution of resources is designed to enhance the production of goods and services maximally.

Demand Conditions

Factors that affect consumer desire for a product or service, including income levels, tastes, and price of substitutes.