Frictional Unemployment

question 50

Multiple Choice

Frictional unemployment

• A) would be eliminated if the economy were more stable.
• B) would be eliminated if the minimum wage were raised.
• C) is the result of workers' skills not matching the jobs available.
• D) is present even when labor markets are working well.

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Definitions:

Prime Rate

The interest rate that commercial banks charge their most credit-worthy customers, frequently used as a benchmark in lending rates.

Commercial Banks

Financial institutions that accept deposits, offer various loans, and provide other financial services to the public.

Open Market Operations

Central bank activities involving the buying or selling of government securities to control the money supply and interest rates.

Discount Rate

The interest rate set by central banks that is charged to commercial banks for loans, influencing monetary policy and the money supply.