Question

It has a different explanation than does the natural rate of unemployment. b. refers to the year-to-year fluctuation in unemployment around an economy’s natural rate of unemployment. c. is closely associated with short-run ups and downs of economic activity. d. All of the above are correct.

Answer 1

Answer:

d. All of the above are correct.

Explanation:

Cyclical unemployment:-

It is the unemployment which results when overall demand for the services as well as the goods in the economy failed to support the full employment. It occurs when there are periods of the economic contraction or the periods of the slow economic growth.

Thus, correct statements are:-

• It has a different explanation than does the natural rate of unemployment.
• refers to the year-to-year fluctuation in unemployment around an economy’s natural rate of unemployment.
• is closely associated with short-run ups and downs of economic activity.

Hence, d is the answer.