What Does Cyclical Unemployment Refer To

question 129

Multiple Choice

What does cyclical unemployment refer to?

• A) the relation between the probability of unemployment and a worker's years of experience
• B) how often a worker is likely to be unemployed during her lifetime
• C) year-to-year fluctuations of unemployment around its natural rate
• D) long-term trends in unemployment

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Definitions:

Cyclical Unemployment

This type of unemployment is caused by the downturns in the business cycle, where workers lose their jobs due to a lack of demand during economic recessions.

Discouraged Worker

An individual who has stopped looking for employment due to the belief that no jobs are available for them or there are none for which they would qualify.

BLS

The Bureau of Labor Statistics, a US government agency responsible for collecting and analyzing critical economic data, including employment and inflation.

Natural Unemployment Rate

The lowest level of unemployment that an economy can sustain over the long term without causing inflation.