Answer to Question #225720 in Macroeconomics for Macroecon Student

Question

Using the assumption of the labour market in unit 9, if employment equals 20 000 people and output is 35 000, we can conclude that

A. there is no cyclical unemployment.

B. there is no frictional unemployment.

C. the economy has not reached equilibrium.

D. there is no structural unemployment. 

Answer 1

A. There is no cyclical unemployment .

This is because the business has demand for more labor to employ all those who are looking for jobs at that particular point within the business cycle.