eFFECTS OF gdp and nru

Question 1

What is the lowest unemployment rate in recent decades?

Answer 1

2007-2008: 4%, 2022-2023: 3.5%

Question 2

Why is unemployment never zero?

Answer 2

Frictional (job changes/graduates) and structural (new skills) unemployment always exist.

Question 3

When can cyclical unemployment be zero?

Answer 3

During economic booms.

Question 4

. What is the natural rate of unemployment?

Answer 4

The lowest rate of unemployment due to natural economic forces.

Question 5

What factors have raised the natural rate of unemployment over time?

Answer 5

Advances in technology, labor market changes.

Question 6

What is the GDP gap?

Answer 6

Difference between actual GDP and potential GDP.

Question 7

Positive effect of frictional unemployment?

Answer 7

Better pay, work conditions, and new opportunities.

Question 8

Positive effect of structural unemployment?

Answer 8

Incentive to learn new skills, improves productivity.

Question 9

Negative effects of unemployment?

Answer 9

Lower living standards, reduced spending, wasted human capital.

Question 10

How does cyclical unemployment differ from other types?

Answer 10

It results from economic cycles (upturns/downturns).