AP Macroeconomics Question 405: Answer and Explanation

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Question: 405

4. When a nation is operating at the natural rate of unemployment,

  • A. there is no cyclical unemployment.
  • B. the inflation rate is zero.
  • C. there is no structural unemployment.
  • D. the nation is experiencing a recession.
  • E. the unemployment rate is zero.

Correct Answer: A


A-At the natural rate of unemployment, there is frictional and structural unemployment, but no cyclical job loss.