The Natural Rate of Unemployment Is Defined as the Rate

question 89

Multiple Choice

The natural rate of unemployment is defined as the rate of unemployment that

• A)prevails in long-run macroeconomic equilibrium,when all workers and employers have fully adjusted to any changes in the economy.
• B)prevails in the short-run macroeconomic equilibrium,before workers and employers have had a chance to adjust to an economic shock.
• C)exists due to welfare and employment benefits that reduce potential workers' incentives to find work.
• D)exists only during periods of recession or depression in the economy.

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Definitions:

Maker

The individual or entity that creates or issues a financial instrument, such as a check or a promissory note.

Note Receivable

A written promise that one party will pay another party a specified sum of money, either on demand or at a set future date.

Promissory Note

A financial instrument in which one party promises in writing to pay a determinate sum of money to the other, either at a fixed or determinable future time or on demand of the payee, under specific terms.

Accounts Receivable

Funds that customers owe to a business for products or services already provided but not yet compensated for.