22. At the full-employment unemployment rate there is only: A. cyclical and fric

Question

22. At the full-employment unemployment rate there is only: A. cyclical and frictional unemployment. C. demand-deficient unemployment. B. frictional and structural unemployment. D. "discouraged workers" unemployment. 23. If the GDP gap is positive, then: A. the inflation rate is falling C potential GDP is greater than actual GDP. B. the unemployment rate is rising. D. actual GDP is greater than potential GDP. 24. A high unemployment rate most likely means that there is a: A. high rate of inflation in the economy. C. large GDP gap in the economy. B. low rate of interest in the economy D. small GDP gap in the economy.

Explanation / Answer

22) THe asnwer B -) Frictional and structural unemployment.

because when an economy is at full employment - unemployment rate is equal to natural rate of unemployment and NRE is equal to sum of frictional and structural unemployment.

23) THe answer is D -) Actual GDP is greater than potential GDP .

because the output gap is known as the difference bewteen actual gdp and potential gdp. whenit is positive it means actual gdp is > than potential GDP

24) The answer is C -) Large GDP gap in the economy.

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